Week to date since July 22, 2026 as of July 29, 2026

Index definitions: Global Real Estate = FTSE EPRA/NAREIT Developed Index; Global Infrastructure = Dow Jones Brookfield Global Infrastructure Index; Natural Resource Equities = S&P Global Natural Resources Index; Commodity Futures = Bloomberg Commodity Index; TIPS = Barclays US TIPS Index; Global Equities = MSCI World Index; Real Assets Index = 30% FTSE EPRA/NAREIT Developed Index, 30% Dow Jones Brookfield Global Infrastructure Index; 15% S&P Global Natural Resources Index; 15% Bloomberg Commodity Index, 10% Barclays TIPS Index. Source: Bloomberg, DWS. Past performance is not indicative of future results. It is not possible to invest directly in an index.

Market commentary

As July drew to a close, markets swung between divergent drivers. Tensions in the Gulf briefly reignited supply concerns, while the Federal Reserve's decision to hold rates steady was overshadowed by three dissenting votes in favor of a hike, reinforcing higher-for-longer concerns. The real battleground, however, was AI. Semiconductor and technology stocks initially tumbled as investors questioned whether record AI-related capital expenditure would generate sufficient returns. The narrative shifted sharply after strong results from Microsoft and Amazon restored confidence in the AI investment cycle, sparking a powerful rebound across technology and broader equity markets. Beneath the headlines, economic data were generally more resilient than feared. Eurozone growth surprised to the upside, U.S. core inflation moderated and consumer spending remained healthy, while weaker Chinese manufacturing data highlighted an uneven global backdrop. By week’s end, investors were left weighing resilient growth and strong earnings against elevated valuations, restrictive monetary policy, and geopolitical uncertainty.^[1]​

For the period, real assets outperformed broader global equities. Within real assets, positive returns from Global Real Estate Securities and Natural Resource Equities were offset by weakness in Commodity Futures and Global Infrastructure Securities. Global real estate performance was supported by gains across both U.S. and international markets, while infrastructure returns were weighed down by weakness in European and North American names. Across other market indicators, the VIX, a measure of 30-day expected stock market volatility, rose sharply from 16.6 to 20.7, reflecting higher expected equity market volatility. Inflation expectations edged lower, with 5-year and 10-year breakeven inflation rates declining 4 basis points (bps) and 1 bp, respectively. Gold prices fell 1.5% to $4,068/ounce, while oil prices declined 2.7% to $84.46/barrel. The U.S. dollar weakened slightly against major trading partners, while credit spreads widened, increasing 3 bps for investment grade and 14 bps for high yield debt.^[1]​

Why it matters: Economic growth remains resilient, but markets are increasingly focused on whether massive AI investment can generate the earnings needed to justify current valuations. For now, sector rotation is supporting equity markets, but inflation, central bank policy, and geopolitical risks remain important constraints.

This week, we examine some of the key forces shaping markets: durable economic data, cautious central banks, and a Federal Reserve that delivered more questions than answers.

• Sentiment — Resilience beneath the noise: Economic data painted a mixed picture, but underlying activity remained healthier than feared. Eurozone growth surprised to the upside, German business confidence improved for a third consecutive month, and U.S. consumption remained supportive, helping offset weaker Chinese manufacturing data and ongoing geopolitical uncertainty.^[1]​
• Central Banks — On hold, still cautious: Major central banks left rates unchanged, but policymakers offered little comfort to markets. The ECB remained data-dependent, the BoJ continued to signal further policy normalization, and the BoE struck a somewhat softer tone while keeping its options open. Taken together, central banks remain cautious, leaving investors focused on inflation risks and the path of rates into September.^[2]​
• FOMC – Hold, but not relief: The Federal Reserve voted 9-3 to hold the federal funds rate at 3.50%-3.75% at its July meeting, only the second chaired by Kevin Warsh.^[2]​ While the decision was widely expected, three policymakers dissented in favor of a 25bp hike, highlighting persistent concerns over inflation and keeping a September increase firmly in play. Markets were left unsettled by Warsh's refusal to provide forward guidance, his suggestion that higher bond yields were already doing some of the Fed's tightening work, and comments hinting at a potential rethink of the Fed's inflation framework. Rather than providing clarity, the meeting increased uncertainty around the policy outlook, pushing 30-year Treasury yields briefly to their highest level since 2007 and reinforcing higher-for-longer concerns.^[1]​

Real Assets, Real Insights: This week we look at data center developments, transactions in midstream energy, and the broader shipping impact of changing LNG flows.

• Cash out (Real Estate): Koch is reportedly exploring a sale of data-center developer Edged, with multiple bids potentially valuing the platform at more than $15 billion. The company operates seven facilities, including a 169-megawatt Atlanta campus, and has additional projects under development.^[3]​ Surging AI-related computing and power demand draws private capital toward hyperscale data-center expansion, with hyperscalers expected to spend approximately US $5.3 trillion on AI and data-center infrastructure through 2030.^[4]​
• More pipe (Infrastructure): Kuwait Petroleum Corporation signed a $16 billion lease-and-leaseback agreement for its crude pipeline network with a consortium of global infrastructure investors. This marked the country’s largest-ever foreign direct investment and underscored continued institutional demand for contracted energy infrastructure assets in the Gulf. The structure preserves KOC’s 51% ownership and operational control while generating $7.85 billion in upfront proceeds to support capital spending. The move is consistent with a broader regional trend of state energy companies monetizing midstream assets to fund domestic investment plans.^[5]​
• Open seas (Commodities): Global natural gas demand has strengthened the outlook for LNG carriers. The trend has been strengthened by accelerating investment in new liquefaction capacity, particularly in the U.S. This has prompted an increase in forecast containment-system design orders to approximately 550 vessels over 2026–2035, from more than 450 previously. The final investment decisions covered 84 million tonnes per annum of new capacity last year and a further 37 million tonnes in the first half of 2026. The commodity rally and supportive demand have helped drive shipyard and equipment-provider backlogs, as Asian gas consumption expands and Europe continues to diversify away from Russian pipeline supply.^[1]​