S&P 500 and Nasdaq notch record high closes, lifted by Alphabet
Google-parent Alphabet rallied ahead of its quarterly report on Wednesday. It and Tesla, also reporting on Wednesday, kick off earnings from the so-called 'Magnificent Seven,' and their results may set the tone for other heavyweight companies reporting in the next several days.
Apple and Amazon each gained and helped lift the S&P 500.
Verizon rallied after the telecommunications company boosted its annual profit forecast.
Analysts on average expected S&P 500 companies to report a 6.7% increase in earnings for the second quarter, with Big Tech driving much of that gain, according to LSEG I/B/E/S.
'So far, companies that have reported have, in general, met or beat guidance from the prior quarter, and we haven't seen any degradation either in corporate profits or consumer spending,' said Tom Hainlin, national investment strategist at U.S. Bank Wealth Management in Minneapolis.
With U.S. President Donald Trump's August 1 tariff deadline approaching, the S&P 500 .SPX is up about 8% year to date, with investors betting the economic damage from tariffs will be less than feared.
U.S. Commerce Secretary Howard Lutnick said on Sunday he was confident the United States could secure a trade deal with the European Union, even as EU members explored possible countermeasures against the United States.
Trump has threatened 30% tariffs on imports from Mexico and the EU, and sent letters to other trading partners, including Canada, Japan and Brazil, setting tariffs ranging from 20% to 50%.
According to preliminary data, the S&P 500 .SPX gained 9.63 points, or 0.15%, to end at 6,306.42 points, while the Nasdaq Composite .IXIC gained 82.99 points, or 0.40%, to 20,978.64. The Dow Jones Industrial Average .DJI fell 3.08 points, or 0.01%, to 44,339.11.
Investors focused on how tariff uncertainty is impacting the U.S. economy will scrutinize jobless claims data and the July business activity report, expected on Thursday.
They will also watch a speech by Federal Reserve Chair Jerome Powell on Tuesday for clues about when the Fed might cut interest rates, especially after mixed inflation signals last week.
Traders have largely ruled out a July rate cut, and they now see a greater than 50% chance the Fed will cut by its September meeting, according to CME Group's FedWatch tool.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Reuters
42 minutes ago
- Reuters
Capital One reports higher profit as interest income, fees rise
July 22 (Reuters) - Capital One Financial (COF.N), opens new tab reported a rise in second-quarter adjusted profit on Tuesday, as the consumer lender was helped by a boost in interest income on its credit card debt and higher fee income. Shares of the company, which have gained nearly 22% in 2025, rose 2.5% after the bell. Consumer spending displayed underlying resilience in the April to June quarter, as many consumers curtailed discretionary spending amid inflationary pressures fueled by uncertainties over U.S. President Trump's trade policies, while maintaining steady outlays on essential goods and services. However, companies such as Capital One are shielded from economic volatility and ensuing industry weakness because of their credit card business. Interest rates on credit card debt are significantly higher than those on mortgages and other kinds of loans. Capital One became the biggest U.S. credit card issuer by balances after its acquisition of Discover Financial was completed midway through the second quarter, following more than a year of regulatory to-and-fro. The McLean, Virginia-based company's net interest income — the difference between what it makes on loans and pays out on deposits — rose 32.5% to $10 billion in the quarter. Capital One's quarterly non-interest income, which primarily consists of interchange income, net of reward expenses, service charges and other customer-related fees, rose nearly 27% to $2.50 billion. However, as consumers pull back on discretionary spending due to high borrowing costs, companies have resorted to building a bigger buffer to help shield themselves from potential loan defaults. The company's loan loss provisions stood at $11.43 billion in the second quarter, compared to $3.91 billion a year earlier. Net charge-offs, or debts that are unlikely to be recovered, jumped 16% to $3.06 billion in the period, the company said. Capital One's adjusted net income available to common stockholders was $2.77 billion, or $5.48 per share, in the three months ended June 30, from $1.21 billion, or $3.14 per share, a year earlier.
Reuters
an hour ago
- Reuters
Wall Street indexes end split amid mixed earnings, crude slides as trade deadline looms
NEW YORK, July 22 (Reuters) - The Dow gained while the Nasdaq lost ground on Tuesday and crude settled lower as investors assessed a spate of mixed earnings and signs that President Donald Trump's protracted trade war is hitting corporate profit margins, even as Trump's dealmaking deadline approached. The S&P 500 closed with nominal gains as underperforming tech shares (.SPLRCT), opens new tab dragged the Nasdaq into the red. Gold extended its gains in opposition to the softening dollar, and U.S. Treasury yields eased for the third-straight session. "(Investors are) looking for additional catalysts and you're seeing some cautious comments coming out of companies," said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut. "They're hearing mixed guidance when it comes to all this uncertainty revolving around tariffs and the direction things are heading." Second-quarter earnings season has hit full stride, with nearly one-fifth of the companies in the S&P 500 having reported. Of those, 79% have beaten analyst expectations, according to LSEG data. Analysts expect year-on-year S&P 500 earnings growth of 7%, on aggregate, a sizable improvement over the 5.8% growth predicted as of July 1, per LSEG. Still, the effects of the trade war have begun seeping into corporate results. General Motors' (GM.N), opens new tab second-quarter core profit slid 32% as steep tariff costs took a $1.1-billion bite from its bottom line. Prospects of a U.S.-European Union trade deal appeared to be fading as Washington's August 1 deadline loomed, prompting EU members to ramp up possible "anti-coercion" retaliatory measures. U.S. Treasury Secretary Scott Bessent said on Tuesday he would meet with his Chinese counterpart to discuss delaying the August 12 trade talks deadline with China again, as the world's two largest economies wrestle with the flow of technology and rare earth materials. "These are pretty classic negotiations; nothing ever happens until it has to happen," says Chuck Carlson, CEO at Horizon Investment Services in Hammond, Indiana. "Nothing gets done until the deadline, then either the deadline gets extended or there's some resolution that comes out of nowhere." "The flip side of this is Trump's going to have to follow through eventually," Carlson added. "Otherwise, he's going to be the boy that cried wolf, and his negotiating power is going to be sapped because people will believe he's never going to follow through." The Dow Jones Industrial Average (.DJI), opens new tab rose 179.12 points, or 0.40%, to 44,502.19, the S&P 500 (.SPX), opens new tab rose 3.99 points, or 0.06%, to 6,309.59 and the Nasdaq Composite (.IXIC), opens new tab fell 81.49 points, or 0.39%, to 20,892.69. MSCI's gauge of stocks across the globe (.MIWD00000PUS), opens new tab rose 0.68 points, or 0.07%, to 930.31. The pan-European STOXX 600 (.STOXX), opens new tab index fell 0.41%, while Europe's broad FTSEurofirst 300 index (.FTEU3), opens new tab fell 8.50 points, or 0.39% Emerging market stocks (.MSCIEF), opens new tab fell 3.93 points, or 0.31%, to 1,249.53. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS), opens new tab closed lower by 0.17%, to 657.56, while Japan's Nikkei (.N225), opens new tab fell 44.19 points, or 0.11%, to 39,774.92. The dollar continued to edge lower amid a subdued currency market as investors awaited any sign of progress in trade talks ahead of the August 1 deadline. The dollar index , which measures the greenback against a basket of currencies including the yen and the euro, fell 0.5% to 97.36, with the euro up 0.49% at $1.1752. Against the Japanese yen , the dollar weakened 0.56% to 146.56. Bitcoin gained 1.98% to $119,320.90. Ethereum declined 2.41% to $3,668.31. U.S. Treasury yields appeared set to notch a third-straight day of declines as the market took a breather on the heels of Monday's rally. The yield on benchmark U.S. 10-year notes fell 2.8 basis points to 4.342%, from 4.37% late on Monday. The 30-year bond yield fell 2.6 basis points to 4.9111% from 4.937% late on Monday. The 2-year note yield, which typically moves in step with interest rate expectations for the Federal Reserve, fell 1.9 basis points to 3.833%, from 3.852% late on Monday. U.S. crude slid 1.47% to settle at $66.21 per barrel, while Brent settled at $68.59 per barrel, down 0.9%. Spot gold rose 1.07% to $3,431.87 an ounce. U.S. gold futures rose 1.15% to $3,441.00 an ounce.
Reuters
2 hours ago
- Reuters
S&P 500 notches record-high close; GM slumps as tariffs bite
July 22 (Reuters) - The S&P 500 eked out a record-high close on Tuesday, following steep losses in General Motors and a gain in Tesla as investors focused on recent and upcoming quarterly reports and watched for signs of progress in U.S. trade discussions. GM (GM.N), opens new tab tumbled 8.1% after the automaker reported a $1 billion hit from tariffs to its quarterly results, adding more fuel to investor concerns about U.S. President Donald Trump's global trade policy. Shares of Ford Motor (F.N), opens new tab fell about 1%. Tesla (TSLA.O), opens new tab climbed 1.1% a day before its quarterly report, while Alphabet (GOOGL.O), opens new tab, also reporting on Wednesday, rose 0.65%. Optimism about heavy spending on artificial intelligence has underpinned a rally in Wall Street's most valuable companies, with the S&P 500 trading around record highs. "The market is consolidating recent gains and is in a bit of a holding pattern with some huge catalysts over the next week or two, including the August 1 tariff deadline and a lot of important Magnificent Seven earnings," said Ross Mayfield, an investment strategy analyst at Baird. Other Big Tech stocks lost ground, with Meta Platforms (META.O), opens new tab and Microsoft (MSFT.O), opens new tab both losing about 1%. Shares of RTX (RTX.N), opens new tab dropped 1.6% after the aerospace and defense giant t from Trump's trade war despite strong demand for its engines and aftermarket services. Lockheed Martin (LMT.N), opens new tab tumbled almost 11% after its quarterly profit plunged by about 80%. U.S. trade policy remains a major point of uncertainty for investors and companies as Trump's self-imposed August 1 deadline for many countries to reach agreements with the White House approaches. U.S. Treasury Secretary Scott Bessent said he would meet his Chinese counterpart next week to discuss an extension to the August 12 deadline set for tariffs on imports from China. Other trade negotiations appeared stalled, with optimism for a breakthrough deal with India waning and EU officials weighing countermeasures against the United States. The S&P 500 climbed 0.06% to end the session at 6,309.62 points. The Nasdaq declined 0.39% to 20,892.69 points, while the Dow Jones Industrial Average rose 0.40% to 44,502.44 points. Nine of the 11 S&P 500 sector indexes rose, led by healthcare (.SPXHC), opens new tab, up 1.9%, followed by a 1.78% gain in real estate (.SPLRCR), opens new tab. Volume on U.S. exchanges was relatively heavy, with 18.8 billion shares traded, compared with an average of 17.7 billion shares over the previous 20 sessions. Philip Morris (PM.N), opens new tab slumped 8.43% after reporting second-quarter revenue below expectations, as shipments of its ZYN nicotine pouches disappointed investors. Analysts on average expected S&P 500 companies to report a 7% increase in earnings for the second quarter, with technology heavyweights driving much of that gain, according to LSEG I/B/E/S. After last week's mixed economic data, traders have all but ruled out an interest-rate cut from the U.S. Federal Reserve at next week's policy meeting. They now see about a 60% chance of a reduction in September, according to the CME's FedWatch tool. Advancing issues outnumbered falling ones within the S&P 500 (. opens new tab by a 4.3-to-1 ratio. The S&P 500 posted 21 new highs and 1 new low; the Nasdaq recorded 73 new highs and 41 new lows.
