Markets Hit Records as Investors Focus on Corporate Profits
U.S. stock indexes climbed on Monday, with the S&P 500 and Nasdaq Composite both reaching new records as investors anticipated a wave of earnings reports from major American companies. The S&P 500 rose 0.6% by early afternoon, surpassing its previous high from Thursday, while the Dow Jones Industrial Average added 233 points and the Nasdaq gained 0.7%.
Verizon led gains with a 5% surge after posting stronger-than-expected profit and revenue, followed by an upward revision to its full-year forecasts. The solid performance helped offset a 4.2% decline in Sarepta Therapeutics, which remains under pressure after the FDA asked the company to halt shipments of its gene therapy due to safety concerns.
Tariff Tensions Shadow Corporate Momentum
Despite uncertainty from President Donald Trump’s tariff policies, many U.S. companies continue to beat earnings expectations. Verizon’s report was among several strong showings, joined by Cleveland-Cliffs, which jumped 15.6% after reporting narrower losses and record steel shipments. CEO Lourenco Goncalves credited Trump’s tariffs for improving domestic manufacturing demand.
Block, Jack Dorsey’s company behind Cash App and Square, climbed 7.9% after being selected to join the S&P 500 index, replacing Hess following its acquisition by Chevron. Still, other firms like General Motors and Coca-Cola, set to report later this week, are navigating the higher costs associated with imported goods as tariff deadlines loom.
Economic Indicators Show Resilience in Consumer Activity
Encouraging data on U.S. retail sales and a pickup in travel demand reported by United Airlines suggest that American consumers remain relatively healthy. Analysts at Bank of America noted these signals could help support continued economic strength even amid tariff-related uncertainty.
Most of Trump’s proposed tariffs remain on pause, with the next key decision deadline set for August 1. In the meantime, markets are banking on corporate earnings to validate stock valuations that have soared despite the threat of rising trade barriers.
Global and Political Developments in Focus
Treasury yields eased slightly, with the 10-year yield dipping to 4.36% from 4.44% last Friday. Internationally, markets were mixed, with European indexes modestly higher and Asian markets generally positive. Japan’s markets were closed due to a holiday, but political developments there drew attention.
Prime Minister Shigeru Ishiba’s coalition lost its majority in both houses of Japan’s parliament for the first time since 1955. Voter backlash over inflation and political instability may push the government to ramp up fiscal spending, potentially worsening the country’s already high debt levels.
