The S&P 500 Index ($SPX) (SPY) Friday closed up +0.40%, the Dow Jones Industrials Index ($DOWI) (DIA) closed up +0.47%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed up +0.23%. September E-mini S&P futures (ESU25) rose +0.38%, and September E-mini Nasdaq futures (NQU25) rose +0.26%.
Stock indexes settled higher on Friday, with the S&P 500 and Nasdaq 100 posting new all-time highs. Signs of economic resilience and better-than-expected quarterly earnings results are underpinning stocks, with the S&P 500 and Nasdaq 100 posting new record highs this week. According to data compiled by Bloomberg Intelligence, around 83% of S&P 500 companies that have reported Q2 earnings have exceeded analysts’ profit estimates.
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Stocks added to their gains on Friday afternoon when bond yields fell from early highs and moved lower. The 10-year T-note yield finished Friday down by -1 bp to 4.38%.
On the negative side, Intel closed down more than 8% to limit gains in chip stocks after reporting an unexpected Q2 loss of -10 cents a share, which was weaker than the expected 1-cent profit, and announced plans to reduce capital expenditures and cut staff by 15% by the end of the year. Also, Charter Communications closed down more than -18% after reporting Q2 EPS below consensus.
Friday’s US economic news was negative for stocks after Jun capital goods new orders nondefense ex-aircraft & parts unexpectedly fell -0.7% m/m, weaker than expectations of a +0.1% m/m increase.
The markets are awaiting President Trump’s August 1 deadline for trade deals to avoid high tariffs. Last Wednesday, Mr. Trump announced that he intends to send a tariff letter to more than 150 countries, notifying them that their tariff rates could be 10% or 15%, effective August 1. As an update, Mr. Trump late Wednesday said, “We’ll have a straight, simple tariff of anywhere between 15% and 50%,” an indication that the floor for tariffs is rising and suggesting that he would not go below 15%.
Federal funds futures prices are discounting the chances for a -25 bp rate cut at 3% at the July 29-30 FOMC meeting and 66% at the following meeting on September 16-17.
The markets this week absorbed a heavy slate of quarterly corporate earnings, with reports from about one-fifth of the companies in the S&P 500. Early results now show S&P 500 earnings are on track to rise +4.5% for the second quarter, better than the pre-season expectations of +2.8% y/y, according to Bloomberg Intelligence. Around 83% of the S&P 500 companies that have reported have exceeded profit estimates.
Overseas stock markets on Friday settled lower. The Euro Stoxx 50 closed down -0.06%. China’s Shanghai Composite closed down -0.33%. Japan’s Nikkei Stock 225 closed down -0.88%.
Interest Rates
September 10-year T-notes (ZNU25) Friday closed up by +5 ticks. The 10-year T-note yield fell by -1.2 bp to 4.384%. T-notes recovered from early losses on Friday and moved higher after a -1% fall in crude oil prices prompted short covering in T-notes. Also, T-notes rose after comments from President Trump eased fears that he would fire the Fed Chair when he said there was “no tension” with Powell.
T-notes on Friday initially moved lower due to negative carryover from a slide in 10-year German bunds to a 3.75-month low. Also, upcoming supply pressures are weighing on T-notes as the Treasury will auction $69 billion of 2-year T-notes and $70 billion of 5-year T-notes on Monday.
European government bond yields today are moving higher. The 10-year German bund yield rose to a 3.75-month high of 2.769% and finished up +1.6 bp to 2.718%. The 10-year UK gilt yield rose +1.4 bp to 4.635%.
Eurozone Jun M3 money supply rose +.3% y/y, weaker than expectations of +3.7% y/y and the slowest pace of increase in 9 months.
The German Jul IFO business confidence index rose +0.2 to a 14-month high of 88.6, although weaker than expectations of 89.0.
UK Jun retail sales ex-auto fuel rose +0.6% m/m, weaker than expectations of +1.2% m/m.
ECB Governing Council member Kazaks said he saw little reason to lower interest rates further unless the economy suffers a major blow, and “There is value in the ECB holding interest rates at current levels, and the time of no-brainer moves to hike or cut rates is over.”
ECB Governing Council member and Bundesbank President Nagel stated that a steady monetary policy from the ECB is appropriate, as the inflation outlook has remained unchanged and the economic outlook has improved slightly.
Swaps are discounting the chances at 18% for a -25 bp rate cut by the ECB at the September 11 policy meeting.
US Stock Movers
Centene (CNC) closed up more than +6% to lead managed health care providers higher after laying out a plan to address problems in its Affordable Care Act business to ensure it turns a profit in 2026. Also, Molina Healthcare (MOH) closed up more than +4%, and Humana (HUM), Elevance Health (ELV), and CVS Health (CVS) closed up more than +3%. In addition, UnitedHealth Group (UNH) closed up +0.89%.
Deckers Outdoor Corp (DECK) closed up more than +11% to lead gainers in the S&P 500 after reporting Q1 net sales of $964.5 million, well above the consensus of $901.4 million.
Comfort Systems USA (FIX) closed up more than +23% after reporting Q2 revenue of $2.17 billion, stronger than the consensus of $1.96 billion.
Newmont Corp (NEM) closed up more than +6% after reporting Q2 sales of $5.32 billion, better than the consensus of $4.85 billion.
Edwards Lifesciences (EW) closed up more than +5% after reporting Q2 sales of $1.53 billion, better than the consensus of $1.50 billion, and raising its full-year sales forecast to $5.9 billion-$6.1 billion from a previous estimate of $5.7 billion-$6.10 billion, stronger than the consensus of $5.91 billion.
Aon Plc (AON) closed up more than +4% after reporting Q2 adjusted EPS of $3.49, above the consensus of $3.40.
Palantir Technologies (PLTR) closed up more than +2% after Piper Sandler initiated coverage on the stock with a recommendation of overweight and a price target of $170.
Gilead Sciences (GILD) closed up more than +2% after Needham upgraded the stock to buy from hold with a price target of $133.
Carvana (CVNA) closed up more than +2% after Oppenheimer upgraded the stock to outperform from market perform with a price target of $450.
Intel (INTC) closed down more than -8% to limit gains in chip stocks after reporting an unexpected Q2 loss of -10 cents a share, weaker than expectations of a +1 cent profit, and said it will reduce capital expenditures and cut staff by 15% by the end of the year. Also, ASML Holding NV (ASML) and Applied Materials (AMAT) closed down more than -1%.
Crypto-linked stocks were under pressure Friday after the price of Bitcoin (^BTCUSD) fell more than -1% to a 2-week low. As a result, Galaxy Digital (GLXY) closed down more than -3%. Also, MicroStrategy (MSTR), Riot Platforms (RIOT), and Coinbase Global (COIN) closed down more than -1%.
Charter Communications (CHTR) closed down more than -18% to lead losers in the S&P 500 after reporting Q2 EPS of $9.18, well below the consensus of $9.82. Comcast Corp (CMCSA) also closed down more than -4% on the news.
Healthpeak Properties (DOC) closed down more than -6% after reporting Q2 lab same-store NOI growth of 1.5%, below the consensus of 2.45%.
Sarepta Therapeutics (SRPT) closed down more than -6% after an evaluation committee of the European Medicines Agency recommended against the approval of the company’s gene therapy Elevidys.
Henry Schein Inc. (HSIC) closed down more than -1% after Stifel downgraded the stock to neutral from buy.
Earnings Reports (7/28/2025)
Amkor Technology Inc (AMKR), Brixmor Property Group Inc (BRX), Brown & Brown Inc (BRO), Cadence Design Systems Inc (CDNS), Cincinnati Financial Corp (CINF), Crane Co (CR), Exelixis Inc (EXEL), Hartford Insurance Group Inc/The (HIG), Kilroy Realty Corp (KRC), NOV Inc (NOV), Nucor Corp (NUE), Olin Corp (OLN), Principal Financial Group Inc (PFG), Revvity Inc (RVTY), Rithm Capital Corp (RITM), Simpson Manufacturing Co Inc (SSD), Universal Health Services Inc (UHS), Veralto Corp (VLTO), Waste Management Inc (WM), Welltower Inc (WELL), Western Union Co/The (WU), Whirlpool Corp (WHR), Woodward Inc (WWD).
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