Another record on Wall Street. Yesterday, the S&P 500 inched up 0.06%, a small move that was enough to set a new all-time high. The Nasdaq, however, slipped 0.5%, dragged down by Meta (-1.1%) and Nvidia (-2.5%).
 
Despite the Nasdaq’s dip, the broader trend hasn’t changed: U.S. indexes remain near record highs. Some are calling these records “boring” - and for good reason. Volatility is muted, with the VIX hovering around 16, and index swings have been minimal. In fact, the S&P 500 hasn’t moved more than 1% at the close since June 24- over a month ago.
 
What explains this calm? Two theories stand out. The first: traders have tuned out, maybe even watching the Tour de France.
 
The second - and more likely - reason: markets are caught between two opposing forces. On one hand, uncertainty around tariffs and their impact on growth and inflation; on the other, fear of missing out on a rally. Investors hope tariffs won’t bite too hard, and that any damage could be offset by tax cuts and deregulation. For now, FOMO seems to be winning, especially as the Trump administration delays tariff deadlines.
 
Still, beneath the surface, earnings season is creating real volatility in individual stocks. Yesterday, General Motors fell 9% after tariffs weighed on its quarterly results. Philip Morris plunged more than 8% on disappointing numbers. And the defense sector saw a sharp divergence: Northrop Grumman gained 9%, while Lockheed Martin sank 11%.
 
Today, earnings remain the main driver. Markets will first react to strong results from SAP, Europe’s largest company by market cap. But all eyes are on Tesla and Alphabet this evening. Alphabet, in particular, will be a key test of the AI-driven momentum that has powered markets for months. Confidence seems high - the stock just logged 10 straight sessions of gains.
 
Meanwhile, trade developments are back in the headlines. Talks with China are set to resume next week in Stockholm, according to Scott Bessent. Later, President Trump announced an agreement with the Philippines, which will face a 19% tariff. The biggest news came overnight: a deal with Japan that caps tariffs at 15%, including on autos - well below the 30% level floated in recent weeks.

The announcement sent the Tokyo Stock Exchange soaring. The Nikkei rose 3% this morning, buoyed by car manufacturers, which all gained more than 10%. Chinese indexes are also in the green, as are India's Nifty50 (+0.22%) and Taiwan's TWSE50 (+0.94%). Only the Kospi is down (-1.27%). In Europe, leading indicators are also up. 

Today's economic highlights:

Housing sales and crude oil inventories in the United States. See the full agenda here.

In corporate news:

  • Amazon is closing its artificial intelligence lab in Shanghai, according to the Financial Times.
  • Apple, Alphabet – The UK competition regulator said it plans to grant Apple and Google “strategic market status” due to their role in mobile ecosystems, as it strengthens oversight of what it calls a “duopoly.”
  • At&t beat quarterly earnings estimates and added more mobile subscribers than expected, driven by demand for discounted bundles combining 5G mobile and fiber broadband.
  • Baker Hughes exceeded second-quarter earnings expectations thanks to strong demand for natural gas services, though it warned about a potential decline in oil producers’ spending.
  • Boston Scientific raised its annual profit outlook after strong demand for its cardiac devices helped the company beat second-quarter earnings estimates.
  • Clorox filed a lawsuit against IT services provider Cognizant over a major 2023 cyberattack, alleging hackers gained access by tricking Cognizant employees into revealing passwords.
  • CME Group beat Wall Street estimates for second-quarter earnings, driven by record volatility that boosted demand for its hedging products.
  • Conocophillips is in advanced talks to sell assets in Oklahoma to Stone Ridge Energy for about $1.3 billion, according to Reuters sources.
  • Enphase Energy issued third-quarter revenue guidance below Wall Street expectations and said U.S. tariffs imposed by President Trump impacted its gross margins, sending its shares down over 7% after hours.
  • EQT Corp beat Wall Street estimates for adjusted second-quarter earnings, supported by higher natural gas prices and sales volumes.
  • Ford, General Motors, Stellantis – A trade group representing the three automakers voiced concerns about a potential trade deal that could cut tariffs on Japanese auto imports to 15% while keeping Canadian and Mexican imports at 25%.
  • General Dynamics exceeded second-quarter earnings and revenue estimates, boosted by strong results in its marine segment and higher business jet deliveries.
  • Hasbro raised its annual revenue forecast, citing strong demand for “Magic: The Gathering” games and cost-cutting measures amid economic and trade uncertainty.
  • Hilton Worldwide raised its 2025 profit outlook, citing a rebound in U.S. travel demand following a slowdown in March and April caused by tariff disputes that discouraged leisure spending.
  • Intuitive Surgical beat Wall Street expectations for second-quarter earnings and revenue, driven by growing demand for its robotic systems used in minimally invasive surgeries.
  • Microsoft – A security patch issued this month failed to fully fix a critical vulnerability in the company’s SharePoint server software, enabling a large-scale global cyberespionage campaign, according to Reuters.
  • Moody’s reported higher second-quarter profits thanks to strong growth in its data and analytics unit and increased public debt issuance.
  • Morgan Stanley is under investigation by the Financial Industry Regulatory Authority (FINRA) over how it monitored clients for money laundering risks, the Wall Street Journal reported.
  • Nextera Energy beat Wall Street estimates for adjusted second-quarter earnings, driven by strong results in its renewables division amid rising electricity demand from AI data centers and hyperscalers.
  • NIQ Global – The market research firm backed by Advent International and KKR raised $1.05 billion in its U.S. IPO.
  • Northern Trust beat Wall Street second-quarter earnings estimates, supported by a stock market recovery and higher fees that boosted asset and wealth management results.
  • Paypal partnered with India’s popular Unified Payments Interface operator and other players to launch a global platform enabling cross-border consumer payments to businesses.
  • Teledyne Technologies raised the lower end of its annual earnings forecast after beating Wall Street second-quarter expectations, driven by strong demand for military drones and target detection sensors.
  • Texas Instruments issued quarterly earnings guidance that disappointed investors, citing weaker-than-expected demand for analog chips and ongoing tariff-related uncertainty.

Analyst Recommendations:

  • 3M: Baptista Research maintains its “Hold” rating and raises the price target from $150 to $168.30.
  • Capital One Financial: JP Morgan maintains its “Neutral” rating and raises the price target from $245 to $248.
  • Cloudflare: DZ Bank AG Research downgrades to “Sell” from “Buy” but raises the price target from $140 to $170.
  • Constellation Energy: Wolfe Research maintains its “Outperform” rating and raises the price target from $376 to $383.
  • Crown Holdings: Morgan Stanley maintains its “Overweight” rating and raises the price target from $118 to $122.
  • Estée Lauder: Baptista Research upgrades to “Hold” from “Underperform” and raises the price target from $61.40 to $73.90.
  • GE Aerospace: Baptista Research maintains its “Hold” rating and raises the price target from $219.80 to $291.70.
  • Kinder Morgan: Baptista Research downgrades to “Hold” from “Buy” and lowers the price target from $37.20 to $30.70.
  • Levi Strauss: Baptista Research maintains its “Hold” rating and raises the price target from $16.30 to $23.80.
  • Lockheed Martin: Morgan Stanley maintains its “Overweight” rating and lowers the price target from $575 to $530.
  • Marsh & McLennan: Baptista Research maintains its “Hold” rating and lowers the price target from $233.60 to $232.20.
  • MSCI: Goldman Sachs maintains its “Buy” rating and lowers the price target from $674 to $634.
  • Northrop Grumman: Goldman Sachs maintains its “Neutral” rating and lowers the price target from $510 to $487.
  • Omnicom Group: Baptista Research maintains its “Buy” rating and lowers the price target from $102.50 to $95.
  • Paccar: Morgan Stanley maintains its “Equal Weight” rating and lowers the price target from $96 to $90.
  • PepsiCo: Baptista Research maintains its “Hold” rating and raises the price target from $150.50 to $153.
  • PulteGroup: Raymond James maintains its “Outperform” rating and raises the price target from $115 to $140.
  • RTX: JP Morgan maintains its “Overweight” rating and raises the price target from $145 to $175.
  • Stellantis: Grupo Santander maintains its “Neutral” rating and lowers the price target from €9.30 to €8.80.
  • Talen Energy: Wolfe Research maintains its “Outperform” rating and raises the price target from $321 to $425.
  • Sherwin-Williams: JP Morgan maintains its “Overweight” rating and lowers the price target from $390 to $378.
  • Verizon Communications: DZ Bank AG Research maintains its “Hold” rating and raises the price target from $43.50 to $45.
  • Vistra: Wolfe Research maintains its “Outperform” rating and raises the price target from $210 to $216.