After a months-long rally back from April’s tariff tumult, the stock market might face its match this month as market optimism is made to face reality. Here’s what’s happening this week…

• It’s a light week for earnings; of the 250+ companies reporting, the only ones of note are squeezed into two days. Wednesday numbers are due from Salesforce, Figma, Hewlett Packard Enterprise, Dollar Tree, Campbell’s, and Macy’s, followed Thursday by Broadcom, lululemon, DocuSign, and Toro. *

• Thursday’s ISM Services PMI (Purchasing Managers’ Index) is the key gauge of U.S. economic momentum, especially as manufacturing remains in contraction. The index tracks activity in non-manufacturing sectors like transportation, finance, and hospitality. July’s reading barely scraped above 50.1%, and economists expect a modest uptick to 50.5%. A weak print could reignite recession fears and push policymakers toward aggressive easing. **

• Markets are holding their breath ahead of Friday’s Non-Farm Payrolls report, expected to show a rebound to 120K jobs after July’s dismal 73K. With unemployment forecast to dip to 4.1%, this release could seal the deal on a September rate cut—currently priced in at 89% odds. But any surprise strength could delay the Fed’s move, rattling equities and bonds alike. ***

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