Prime Highlights
- S&P 500, Nasdaq close at record levels atop earnings strength and tech.
- Dow edges down on profit-taking; Block, Verizon lead stellar stock performances.
Key Facts
- Block Inc. jumped almost 8% after officially joining the S&P 500.
- Verizon beat earnings estimates and increased full-year guidance.
Key Background
US stock markets closed in a mixed manner Monday, with the S&P 500 and Nasdaq both reaching new all-time highs. The S&P 500 edged up a modest 0.1% to 6,305.60, and the Nasdaq gained 0.4%. The Dow Jones Industrial Average dipped modestly on 19 points as traders withdrew profits from the equation. The advance was powered by favorite corporate earnings led by Verizon and Cleveland-Cliffs, both of which posted better-than-estimated figures. Verizon also boosted its full-year outlook, but on expectations for consumer and telecom space.
The week is important for Wall Street because big tech companies are going to report profits. Expectations from Alphabet and Tesla fueled technology stocks as a whole. Tesla gained nearly 1.7%, and Alphabet gained 0.5%, indicating that investors were optimistic before the results. The kind of rebound was a major reason for the Nasdaq’s high closing. Block Inc. also rose nearly 8% after finally joining the S&P 500, indicating that institutional buying is increasing.
Market sentiment was also supported by enhanced trade relations. U.S. Commerce Secretary emphasized positive steps in negotiations with the EU on avoiding further tariffs ahead of the August 1 deadline. Though tensions exist, this diplomatic remark came a long way in soothing investor anxiety, particularly from open economies to international trade.
Traders look forward to the next move by the Federal Reserve. With inflation slowing and economic statistics in a holding pattern, expectations grow that the Fed will reduce interest rates as early as this month. Market analysts put the rate cut at 60%, and that would inject even more fuel into stocks. But the central bank’s upcoming words are still the pivotal influence on near-term direction for markets.
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