Market Recap – Friday, July 25, 2025
US Stocks End Mixed, Focus on Earnings and Trade Deals
Stocks closed mixed on Friday, with the S&P 500 and Nasdaq setting new record highs, while the Dow and Russell 2000 saw declines. The market remained relatively quiet for much of the day but gained momentum as the session progressed. Outperformers included healthcare (Medicaid MCOs), energy, and steel stocks, while big tech names like Tesla (TSLA) recouped some of yesterday's losses. Other sectors like semiconductors, China tech, and telecom stocks struggled, along with many retail-investor favorites.
Treasuries showed slight weakness, with yields rising at the shorter end. Commodities saw mixed movement, with gold down 1.1% and crude oil up 1.2%. The dollar index rose by 0.3%, while Bitcoin futures gained 0.6%.
Focus on Earnings and Trade Deals Ahead of Key Deadlines
The market's attention was split between mixed earnings reports and ongoing trade developments. The US and EU are reportedly nearing a deal involving a 15% tariff on European imports, a key focus ahead of the August 1st deadline. Meanwhile, the first round of earnings from major tech companies has been a mixed bag, with Alphabet (GOOGL) performing well due to strong AI growth, while Tesla (TSLA) faced challenges in the EV market.
Economic Data: Tariffs, Jobless Claims, and Housing Concerns
On the economic front, the latest data showed a decline in June durable goods orders, signaling softer demand. The Richmond Fed manufacturing index also came in weaker than expected, reflecting ongoing struggles in the manufacturing sector. However, jobless claims ticked lower, and the PMI data for services showed strength, highlighting resilience in parts of the economy. Meanwhile, June existing home sales missed expectations, with lower supply and high mortgage rates continuing to hinder homebuying activity.
Here's Our Take
The market is currently in a bit of a holding pattern, with many investors waiting for key earnings reports and trade developments to guide the next big move. While tech stocks like Alphabet continue to benefit from AI growth, Tesla's challenges in the EV space and broader macro concerns in sectors like housing and manufacturing remain under scrutiny. The ongoing trade negotiations, particularly between the US and EU, are crucial as we approach the August 1st tariff deadline. Despite some of these concerns, the overall market remains resilient, buoyed by a low-volatility environment, strong earnings momentum, and continued expectations for a relatively dovish Fed. However, the market's reliance on AI growth and the mixed economic data suggest that caution may be needed in the near term.
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