Stock Market Today (July 23, 2026): Oil Nears $100 as AI Capex Shock Hammers Markets

Brent crude briefly touched $100 per barrel Thursday while Alphabet (GOOGL) and Tesla (TSLA) tumbled in premarket trading after both companies announced massive capital expenditure hikes - sending the Nasdaq down 2.1% and the S&P 500 off more than 1%.

Oil Surges Toward $100 as Red Sea Attacks Escalate

Iran-backed Houthi militants struck two Saudi Arabian oil tankers - the Encelia and the Layla - with missiles and drones in the Red Sea, triggering a 6.2% spike in Brent crude that briefly pushed prices to $100 per barrel, a level not seen since May 2026.

Five Saudi tankers diverted course following a Houthi "maritime embargo" declaration, threatening crude supplies bound for China and India. President Trump warned the U.S. would strike Iranian infrastructure for every vessel attacked in the Strait of Hormuz, keeping risk sentiment firmly negative across global markets.

Energy majors Exxon Mobil (XOM) and Chevron (CVX) bucked the broader selloff, rising sharply on the oil surge. For energy investors, this is the kind of geopolitical premium that drives short-term gains - but also carries the risk of a rapid reversal if diplomatic talks resume.

Alphabet and Tesla: Earnings Beat, But AI Bills Shock Wall Street

Both Alphabet (GOOGL) and Tesla (TSLA) topped second-quarter profit estimates - and were punished for it anyway.

The core concern is straightforward: Wall Street already knew that Alphabet (GOOGL), Tesla (TSLA), Microsoft (MSFT), Meta (META), and Amazon (AMZN) would spend heavily on AI. What investors weren't prepared for was the scale - and the growing lack of near-term proof that returns justify the burn rate. Nvidia (NVDA) is the one name still benefiting directly from this wave, as every dollar of AI capex eventually flows through GPU procurement.

Use the stock screener to filter Magnificent Seven names by free cash flow and forward P/E to see which ones still have room to run at current valuations.

Bond Market Signals Inflation Is Back on the Table

The 10-year U.S. Treasury yield rose to 4.71%, its highest level since January 2025 - up 5 basis points on the day. Oil above $100 directly fuels inflation expectations, and bond markets are repricing the risk that the Federal Reserve will hold rates higher for longer.

This is the critical macro read for equity investors right now: rising yields compress the valuation multiples on growth and AI-heavy stocks. Intel (INTC) and Apple (AAPL), both reporting earnings later this week, face this same headwind going into their prints.

ECB Holds - September Is the Real Decision

The European Central Bank held rates unchanged at its July 23 meeting, as widely expected (markets priced a 95% probability of no move). The ECB raised rates 25 basis points at its June meeting - the first hike since 2023 - and is now monitoring the energy shock carefully.

Markets are now pricing a 70% chance of another ECB hike in September, as the oil surge reignites the inflation concerns that Frankfurt had hoped were fading. The next set of ECB projections arrives September 10, making that the real decision meeting to watch.

Bottom Line

Today is a risk-off session driven by two independent shocks hitting simultaneously: a genuine geopolitical supply disruption in energy markets, and a capex reality check from two of the biggest AI spenders on Wall Street.