On Monday, July 21, investors gained confidence due to the released financial reports. The S&P 500 and the tech-heavy Nasdaq indices hit new intraday highs, with investors also betting on potential trade agreements and anticipating the earnings of large tech companies later in the week.
The Nasdaq Composite Index rose by 0.4% to 20,874.17 points, continuing its upward trend from last week, marking a sixth consecutive trading day of reaching record closing highs. The S&P 500 index briefly touched a new intraday high alongside the Nasdaq but ended with a 0.14% increase at 6,305.60, surpassing last Thursday’s record despite a slight pullback towards the end of the day.
The Dow Jones Industrial Average fell by around 19 points, a minor decline of 0.04%.
As of now, 62 companies in the S&P 500 have reported their financial results, and according to FactSet data, over 85% of these companies have exceeded expectations.
Analysts project an average 6.7% growth in second-quarter earnings for S&P 500 companies, with large tech companies being a significant driver of this growth, as indicated by data from Institutional Brokers’ Estimate System (IBES).
Mike Wilson, Chief U.S. Stock Market Strategist at Morgan Stanley, previously mentioned that the strong momentum in earnings could continue to drive the S&P 500 higher. Wilson forecasted that the index could reach 7,200 points by mid-2026.
As part of the second-quarter financial reports for 2025, Alphabet and Tesla, among the “Big Seven Tech Giants,” are among the first companies to release their earnings on July 23. Their results may set the tone for the financial reports of other heavyweight companies in the coming days.
Alphabet, Google’s parent company, saw a 2.8% rise in its stock price ahead of its third-quarter earnings. Tesla experienced a slight decline of 0.35%, while Apple and Amazon rose by approximately 0.62% and 1.43%, respectively.
Verizon saw a 4.04% increase after raising its annual profit forecast in the telecommunications sector.
Furthermore, U.S. Commerce Secretary Howard Lutnick expressed optimism about reaching a trade agreement with the European Union. During an interview on CBS’s “Face the Nation” on July 20, he stated that there is “enough room” for both sides to reach an agreement.
While considering imposing a 30% tariff on the EU and Mexico, and tariffs ranging from 20% to 50% on other countries like Canada, Japan, and Brazil with an effective date of August 1, President Trump’s tariffs have led to a modest rise of about 8% in the S&P 500 index so far this year. This indicates that investors are betting that the economic impact of tariffs will be less severe than anticipated.