US Equities Weekly Rundown 7 24 26

US Equities Weekly Rundown Global Banking & Markets July 24, 2026 Positioning, Flows, and Observations Across the Floor

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Portfolio Manager’s Summary The S&P 500 fell -0.6% this week, as investors have been navigating rising macro uncertainty (geopolitical escalation in middle east = higher rates + oil prices) and a less constructive EPS season so far (at least from a stock reaction standpoint). Defense Spending, Copper, and Drones were among the themes that outperformed, while Hyperscalers, Rare Earths, and AI Software were among the themes that underperformed.  Prime: US equities were marginally net bought, driven by long buys + short covers in Single Stocks offset by short sales in Macro Products. 9 of 11 sectors were net bought, led by TMT/Healthcare/Real Estate, while Consumer Disc and Staples were net sold. Amid increased hostilities in the middle east and higher oil prices, HFs net bought Energy stocks for a 6th straight week and sector weighting vs. R3K is ~5-year highs, while Staples and Consumer Disc were both among the most net sold in the past month where sector net allocations are near their respective three-year lows.  Shares: On the week, Asset Managers finished net sellers while HF flows were ~flat. We've seen some waves of risk reduction across semis / memory / AI predominately driven by the LO community but overall activity remains tame. There was very little appetite to defend tech pockets as the macro backdrop continues to get tougher for risk + Tech Earnings have largely failed to be the stabilizing force many had hoped for. Elsewhere, we saw an uptick in HF demand to end the week in Healthcare pockets following better earnings (EW and THC) and biotech broadly.  Futures: Equity funding rates continued to normalize this week, with the Sept CME SPX TRF futures settling at the lowest level since March on Thurs (FF+48bp). While net length in S&P futures has ticked back toward the highs, demand for leverage from other sources appears to have moderated, as the recent pullback in AI hardware names has led to a decline in assets within the largest leveraged ETFs where the underlying positions tend to be much less diversified, so they likely carry a higher risk weight on dealers’ balance sheets. Although the front of the curve has normalized, the market is still pricing in a significant premium around year end when balance sheet supply may become more constrained again.  Derivatives: The desk has started to see a pickup in hedging demand as geopolitical tensions and AI capex fears dragged US equity indices lower on Thursday. Notable trades included IWM put spreads and VIX upside. The desk continues to like VIX call spreads out to August / September as a strike-less hedge to the uncertain macro backdrop. We have dealers modeled as long gamma to the topside and shorter gamma to the downside – this technical setup coupled with the feeling of Fed uncertainly also makes short-dated puts / put spreads attractive in S&P.  Baskets: The GS High Beta Momentum Pair (GSPRHIMO) rose 9.4% on Tues, marking its strongest 1-day rally in the last 5 years following a 33% drawdown. The TMT Momentum Pair (GSTMTMOM) also posted its best day on record (+11.1%) and the GS Broad AI Pair (GSPUARTI) experienced its best day since the launch of ChatGPT (+7.1%). While the recent selloff could be a good opportunity to buy the dip in AI and add…