Market Recap – Thursday, July 3, 2025
Stocks closed higher on Thursday, with the S&P 500 and Nasdaq hitting new record highs, marking a strong finish for the holiday-shortened week. The Dow and Russell 2000 also posted solid gains. Banks, travel, leisure, semiconductors, and insurance companies led the charge. Big tech stocks, including Apple and Tesla, also showed strength. However, sectors like China tech, homebuilders, and housing-linked retail stocks were among the biggest decliners. Gold, oil, and Bitcoin all saw small declines.
Key Market Developments:
The big news today was the passing of the "Big, Beautiful Bill" in the House, which is now set to head to President Trump’s desk just in time for his July 4th deadline. This bill includes tax cuts and spending plans, and while it’s seen as a win for the stock market in the short term, concerns about long-term debt remain. The market also digested the mixed jobs report for June, with a strong headline number of 147K new jobs but weaker private payrolls growth. The average hourly wage grew less than expected, signaling slower wage growth.
In trade news, the US and Vietnam struck a deal, with new tariffs on Vietnamese goods, while tensions remain with China. The US has also eased some restrictions on chip-design software exports to China, as part of an agreement made earlier this year. Meanwhile, President Trump continues to criticize the Federal Reserve, pushing for rate cuts and even calling for Fed Chairman Powell’s resignation.
Commodities & Currency:
In the commodities space, oil prices dropped by 1%, while gold fell by 0.5%. Bitcoin futures were down slightly as well. The US dollar rose by 0.5%, especially against the British pound, amid ongoing political uncertainty in the UK.
Notable Gainers:
TripAdvisor (TRIP): +16.7%, after it was revealed that Starboard Value, an activist investor, built a 9% stake in the company.
Datadog (DDOG): +14.9%, as the company was added to the S&P 500 index.
Olo, Inc. (OLO): +13.6%, after it agreed to be acquired by Thoma Bravo for $10.25 per share.
Cadence Design Systems (CDNS): +5.1%, following the US easing restrictions on chip-design software exports to China.
National Beverage (FIZZ): +4.6%, after reporting better-than-expected revenue in its latest earnings.
Notable Decliners:
Robinhood Markets (HOOD): -3.7%, after news that OpenAI clarified that shares tokenized by Robinhood are not actually OpenAI equity.
Economic Updates:
June Jobs Report: The June nonfarm payrolls came in at 147K, higher than the 118K expected, with a slight decrease in the unemployment rate to 4.1%. However, private payrolls grew more slowly than expected, and wage growth was cooler than anticipated. There are mixed views on the labor market’s strength, with some sectors like leisure and hospitality showing growth, while others, like professional services and education, saw job losses.
Trade News: The US and Vietnam reached a new trade deal, but tensions remain high with other countries like China and Japan. The US also relaxed some export restrictions on chip-design software for China, as part of a deal made earlier this year.
What's Next:
Looking ahead, the markets are focused on the next round of trade negotiations with countries like Japan and the EU, as well as the upcoming economic data releases. The jobs report for June raised some uncertainty, with economists watching closely for signs of a slowdown. The Federal Reserve’s stance on rate cuts remains in the spotlight, with Trump continuing to pressure the central bank.
Here's Our Take:
The stock market showed positive momentum today, with the S&P 500 and Nasdaq hitting new records, buoyed by strong performances from banks, travel, leisure, and tech stocks. While the broader market benefited, sectors like China tech and homebuilders struggled. The passage of the "Big, Beautiful Bill" in the House, which is now heading to President Trump’s desk, adds some short-term optimism, though concerns about long-term debt persist. Economic data showed mixed signals: the headline jobs report beat expectations, but private payrolls growth was weaker, and wage growth cooled. The trade environment also remains tense, with the US pushing forward on tariffs with Vietnam and continuing its negotiations with China and the EU. Looking ahead, the market is watching closely for any shifts in trade policies and the Federal Reserve’s next moves on interest rates, which could influence market sentiment in the coming weeks.
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