Technology Rebounds Unevenly as Investors Reassess AI Spending and Earnings Quality

August 1, 2026

Dave Dookie, Managing Director

• U.S. technology equities led global markets, although performance was selective. The Nasdaq advanced 1.59%, supported by a strong rally in Alphabet, while Apple, Meta, and Micron declined as investors adopted a more cautious stance toward elevated AI-related expenditure and extended valuations.

• Global equity markets posted broadly positive returns. The S&P 500 (+1.06%), Dow (+1.04%), FTSE 100 (+1.23%), Euro Stoxx 50 (+1.23%), DAX (+2.11%) and Hang Seng (+3.69%) all advanced, while Japan's Nikkei was one of the few major indices to finish lower (-0.39%).

• Energy stocks remained resilient. Brent crude traded near US$88 per barrel, supporting gains in major energy companies such as Shell, BP and Chevron despite continued geopolitical uncertainty in the Middle East.

• The Trinidad and Tobago market was mixed. The Composite Index edged down 0.01%, while trading activity strengthened significantly, with market value rising to TT$7.0 million. NCB Financial Group was the week's best performer (+9.22%) and trading volume leader, while excess banking-system liquidity eased to TT$2.48 billion.

• Caribbean sovereign bonds remained stable. Trinidad and Tobago continued to offer the lowest yields among regional peers, reflecting stronger credit quality, while Jamaica maintained solid investor demand. Barbados and the Dominican Republic continued to provide higher yields, offering investors additional income in exchange for higher credit risk.

The U.S. technology sector recovered during the week, but performance remained highly uneven as investors distinguished between companies delivering measurable earnings growth and those facing concerns over rising artificial-intelligence expenditure. The Nasdaq Composite gained 1.59% over the last five trading days, outperforming the S&P 500’s 1.06% advance. Alphabet surged 11.38% following renewed optimism around its cloud and AI businesses, while Broadcom gained 1.15%. However, Apple declined 7.24%, Meta fell 6.47%, and Micron dropped 10.63%, demonstrating that the AI trade is no longer lifting the sector uniformly.

The central issue remains whether the substantial capital being committed to data centers, semiconductors and AI infrastructure will generate sufficiently rapid revenue and cash-flow growth. Alphabet recently increased its capital expenditure guidance, while investors are also scrutinizing spending plans at other large technology companies. Higher long-term Treasury yields further complicated valuations because they reduce the present value of expected future earnings. The sector’s long-term outlook remains constructive, but elevated valuations, market concentration and rising debt funded investment suggest that future gains may depend increasingly on earnings execution rather than enthusiasm alone.

U.S. equities ended the week higher overall. The S&P 500 Total Return Index advanced 1.06%, the Dow Jones gained 1.04%, and the Nasdaq rose 1.59%. Energy shares were generally firm, supported by Brent crude near US$88 per barrel and continued geopolitical risks. Shell gained 2.36%, Chevron rose 1.05%, and BP advanced 3.19%, while ExxonMobil slipped marginally. Travel related stocks were mixed, with American Airlines up 5.49% and Expedia gaining 13.39%, although Boeing declined 3.16%.

In the United Kingdom, the FTSE 100 increased 1.23%, supported by energy, financial and defensive companies. Across continental Europe, the Euro Stoxx 50 rose 1.23%, France’s CAC 40 gained 1.64%, and Germany’s DAX advanced 2.11%. Italy was more subdued, with the FTSE MIB up only 0.71% and the broader Italian equity index gaining 2.43%. European sentiment benefited from resilient corporate earnings, although higher oil prices and uncertainty over interest rate policy continued to limit risk appetite.

Asian markets were mixed. Hong Kong’s Hang Seng gained 3.69%, while China’s Shanghai Composite rose 0.47%, supported by selective buying and expectations of further policy assistance. Japan’s Nikkei 225 declined 0.39%, despite a strong final session, while Australia’s ASX 200 gained 2.33%. Regional technology shares remained volatile as investors assessed global semiconductor demand and the sustainability of AI-related investment.

The Trinidad and Tobago equity market ended the week nearly unchanged, though trading activity improved. The Composite Index edged down 0.01%, and the All T&T Index declined 0.95%. The Cross Listed Index rose 2.77%, supported by NCB Financial Group, which gained 9.22% and led trading volume. JMMB Group advanced 4.94%, while Unilever Caribbean added 3.53%. On the downside, One Caribbean Media fell 15.15%, Massy Holdings lost 3.87%, and ANSA McAL declined 1.85%. First Tier volume increased 86.76% to approximately 672,700 shares, with traded value rising to TT$7.0 million. The banking system excess liquidity eased by about TT$291 million to TT$2.48 billion.

Caribbean USD sovereign bonds remained relatively stable. Trinidad and Tobago’s 2030 bond offered a yield of approximately 5.49%, while the 2034, 2036 and 2038 maturities yielded about 6.10%, 6.25% and 6.37%, respectively. Jamaica’s longer-dated 2036 to 2045 bonds offered 5.69% to 6.15%, supported by continued fiscal discipline. Barbados’ 2029 bond yielded about 5.24%, while the 2035 maturity offered 6.57%. The Dominican Republic’s curve ranged from approximately 4.68% on short maturities to about 6.92% at the long end. Trinidad continued to trade as a relatively defensive regional credit, while Barbados and the Dominican Republic offered greater carry in exchange for higher credit and duration risk.

US Equity Indices

Index	5-Day Performance	1-Year Return
S&P 500 Total Return	+1.06%	+19.56%
NASDAQ Composite	+1.59%	+20.13%

Source: LSEG Data & Analytics

U.S. Technology Sector Performance

Company	5-Day Return	1-Year Return
Apple (AAPL)	-7.24%	+48.82%
Meta Platforms (META)	-6.47%	-28.02%
Alphabet (GOOGL)	+11.38%	+85.58%
Broadcom (AVGO)	+1.15%	+54.54%
Micron Technology (MU)	-10.63%	+654.10%

Source: LSEG Data & Analytics

About the author: Dave Dookie is the Managing Director of Waterloo Capital Advisors Limited, a Trinidad and Tobago based financial advisory firm specializing in investment management, capital markets and structured finance. He has advised governments, financial institutions, and energy companies on debt issuance, project financing, and strategic capital raising across the Caribbean. He holds degrees and advanced qualifications from the London School of Economics and Political Science (LSE) and the University of London and has completed advanced training in data science through the MIT Applied Data Science Program.

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