The S&P 500 Index ($SPX) (SPY) Thursday closed up +0.07%, the Dow Jones Industrials Index ($DOWI) (DIA) closed down -0.70%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed up +0.25%.  September E-mini S&P futures (ESU25) rose +0.09%, and September E-mini Nasdaq futures (NQU25) rose +0.33%.

Inventory indexes on Thursday settled largely increased, with the S&P 500 and Nasdaq 100 posting new all-time highs.  Earnings outcomes from Alphabet confirmed strong demand for synthetic intelligence and bolstered confidence in know-how shares, which rose after the corporate reported better-than-expected Q2 income.  Shares added to their features on indicators of resilience within the US labor market, following the surprising decline in weekly preliminary unemployment claims to a 3-month low.

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On the detrimental facet, Tesla closed down greater than -7% after reporting its greatest income decline in not less than ten years and CEO Musk warning of a “rough patch” for the corporate for the following 12 months or extra.  Additionally, IBM fell greater than -7% to weigh on the Dow Jones Industrials after reporting weaker-than-expected Q2 software program income.  As well as, indicators of weak point in US manufacturing exercise are bearish for shares after the July S&P US manufacturing PMI fell -3.4 to 49.5, weaker than expectations of 52.7 and the weakest stage in 7 months.

US weekly preliminary unemployment claims unexpectedly fell -4,000 to a 3-month low of 217,000, displaying a stronger labor market than expectations of a rise to 226,000.

The US June Chicago Fed nationwide exercise index rose +0.06 to -0.10, stronger than expectations of -0.15.

US June new residence gross sales rose +0.6% m/m to 627,000, weaker than expectations of +4.3% m/m to 650,000.

The markets are awaiting President Trump’s August 1 deadline for commerce offers to keep away from excessive tariffs.  Final Wednesday, Mr. Trump introduced that he intends to ship a tariff letter to greater than 150 international locations, notifying them that their tariff charges could possibly be 10% or 15%, efficient August 1.  As an replace, Mr. Trump late Wednesday stated, “We’ll have a straight, simple tariff of anywhere between 15% and 50%,” a sign that the ground for tariffs is rising and suggesting that he wouldn’t go under 15%. 

The markets this week will concentrate on any tariff information, together with the announcement of any new commerce offers.  On Friday, June capital items new orders nondefense ex-aircraft and elements are anticipated to extend by +0.2% m/m.

Federal funds futures costs are discounting the probabilities for a -25 bp charge minimize at 3% on the July 29-30 FOMC assembly and 63% on the following assembly on September 16-17.

The markets this week absorbed a heavy slate of quarterly company earnings, with reviews from about one-fifth of the businesses within the S&P 500.  Early outcomes now present S&P 500 earnings are on observe to rise +3.2% for the second quarter, higher than the pre-season expectations of +2.8% y/y, based on Bloomberg Intelligence.  Additionally, solely six of the eleven S&P 500 sectors are projected to put up a rise in earnings, the fewest since Q1 of 2023, based on Yardeni Analysis. 

Abroad inventory markets on Thursday settled increased.  The Euro Stoxx 50 closed up +0.20%.  China’s Shanghai Composite closed up +0.65%.  Japan’s Nikkei Inventory 225 climbed to a brand new 1-year excessive and closed up sharply for a second session by +1.59%.

Curiosity Charges

September 10-year T-notes (ZNU25) Thursday closed down -6 ticks.  The ten-year T-note yield rose by +3.2 bp to 4.412%.  T-notes had been beneath stress on Thursday because of decreased safe-haven demand for presidency securities, as optimism grew that the US would attain extra commerce offers with its buying and selling companions following the clinching of a take care of Japan on Wednesday.  Additionally, Bloomberg Information reported on Wednesday that the US and EU are closing in on a commerce deal.  T-notes dropped to their lows Thursday after weekly US jobless claims unexpectedly fell to a 3-month low, an indication of labor market power that’s hawkish for Fed coverage.

Nonetheless, T-notes recovered from their worst ranges Thursday after June new residence gross sales rose lower than anticipated and the US manufacturing PMI unexpectedly fell to a 7-month low, dovish components for Fed coverage. 

European authorities bond yields on Thursday completed combined.  The ten-year German bund yield rose to a 1-week excessive of two.711% and ended up +6.3 bp to 2.702%.  The ten-year UK gilt yield fell -1.3 bp to 4.622%.

The Eurozone July S&P manufacturing PMI rose +0.3 to a 3-year excessive of 49.8, proper on expectations.  The Eurozone July S&P composite PMI rose +0.4 to 51.0, stronger than expectations of +0.1 to 50.7 and the strongest stage in 11 months.

Eurozone Jun new automobile registrations fell -7.3% y/y to 1.010 million models, the most important decline in 10 months.

The German Aug GfK client confidence index unexpectedly fell -1.2 to a 4-month low of -21.5, weaker than expectations of a rise to -19.3.

As anticipated, the ECB stored the deposit facility charge unchanged at 2.00%.  The ECB stated, “Inflation is currently at the 2% medium-term target,” and the economic system has to this point confirmed resilient, however the setting stays unsure because of commerce disputes.

ECB President Lagarde stated the financial dangers to the Eurozone are tilted to the draw back, and a stronger euro might dampen inflation greater than anticipated.

Swaps are discounting the probabilities at 21% for a -25 bp charge minimize by the ECB on the September 11 coverage assembly.

US Inventory Movers

The Magnificent Seven shares, sans Apple and Tesla, rallied Thursday and supported features within the broader market.  Nvidia (NVDA), Amazon.com (AMZN), and Microsoft (MSFT) closed up greater than +1%.  Additionally, Alphabet (GOOGL) closed up +0.88%, and Meta Platforms (META) closed up +0.17%.

West Pharmaceutical Companies (WST) closed up greater than +22% to guide gainers within the S&P 500 after reporting Q2 internet gross sales of $766.5 million, nicely above the consensus of $726.1 million, and elevating its full-year internet gross sales forecast to $3.04 billion-$3.06 billion from a earlier forecast of $2.95 billion-$2.98 billion, stronger than the consensus of $2.96 billion.

United Leases (URI) closed up greater than +8% after reporting Q2 income of $3.94 billion, above the consensus of $3.90 billion, and stated it was including $400 million to its inventory buyback program.

Labcorp Holdings (LH) closed up greater than +6% after reporting Q2 income of $3.53 billion, higher than the consensus of $3.49 billion, and elevating its full-year adjusted EPS estimate to $16.05-$16.50 from a earlier estimate of $15.70-$16.40.

T-Cell US (TMUS) closed up greater than +5% to guide gainers within the Nasdaq 100 after reporting Q2 whole postpaid internet clients of 1.77 million, above the consensus of 1.34 million, and elevating its full-year postpaid internet clients forecast to six.1 million-6.4 million from a earlier estimate of 5.5 million-6.0 million, higher than the consensus of 5.94 million. 

ServiceNow (NOW) closed up greater than +4% after reporting Q2 subscription income of $3.11 billion, above the consensus of $3.04 billion, and elevating its full-year subscription income forecast to $12.78 billion-$12.80 billion from a earlier forecast of $12.64 billion-$12.68 billion, stronger than the consensus of $12.68 billion.

Las Vegas Sands (LVS) closed up greater than +4% after reporting Q2 internet income of $3.18 billion, nicely above the consensus of $2.83 billion.

A O Smith (AOS) closed up greater than +3% after boosting its full-year internet gross sales forecast to $3.85 billion-$3.93 billion from a earlier forecast of $3.80 billion-$3.90 billion, higher than the consensus of $3.86 billion.

LKQ Corp (LKQ) closed down greater than -17% to guide losers within the S&P 500 after reporting Q2 adjusted EPS persevering with operations of 87 cents, weaker than the consensus of 93 cents.

Dow Inc. (DOW) closed down greater than -17% after reporting a Q2 adjusted working loss per share of -42 cents, a a lot wider loss than the consensus of -18 cents. 

Molina Healthcare (MOH) closed down greater than -16% after reporting Q2 adjusted EPS of $5.48, under the consensus of $5.52, and chopping its full-year adjusted EPS forecast to not less than $19.00 from a earlier estimate of $21.50-$22.50, weaker than the consensus of $22.08. 

Chipotle Mexican Grill (CMG) closed down greater than -13% after reporting Q2 comparable gross sales fell -4%, weaker than the consensus of -2.91%, and chopping its full-year comparable gross sales forecast to 0% from a earlier forecast of low single-digits development. 

Tesla (TSLA) closed down greater than -7% to guide losers within the Nasdaq 100 after reporting Q2 income of $22.50 billion, under the consensus of $22.64 billion, and CEO Musk warning of a “rough patch” for the corporate for the following 12 months or extra. 

Worldwide Enterprise Machines (IBM) closed down greater than -7% to guide losers within the Dow Jones Industrials after reporting Q2 software program income of $7.39 billion, weaker than the consensus of $7.49 billion. 

Southwest Airways (LUV) closed down greater than -11% after chopping its full-year EBIT to $600 million-$800 million from a earlier estimate of $1.7 billion, saying it expects fallout from tariff turmoil to erase as a lot as $1 billion of its annual pre-tax revenue this 12 months.

American Airways Group (AAL) closed down greater than -9% after reinstating annual earnings steering for 2025 from an adjusted lack of -20 cents a share to a revenue of 80 cents, with the midpoint nicely under the consensus of a 72-cent revenue. 

Earnings Reviews (7/25/2025)

Aon PLC (AON), AutoNation Inc (AN), Booz Allen Hamilton Holding Co (BAH), Centene Corp (CNC), Constitution Communications Inc (CHTR), Erie Indemnity Co (ERIE), First Residents BancShares Inc/ (FCNCA), First Hawaiian Inc (FHB), Gentex Corp (GNTX), HCA Healthcare Inc (HCA), Lear Corp (LEA), OneMain Holdings Inc (OMF), Phillips 66 (PSX), Saia Inc (SAIA), Skechers USA Inc (SKX).

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