Wall Street Hits New Record Highs Amid Optimism Over Trade Deals
The European Commission said earlier this week that a negotiated solution was nearing, while U.S. and Chinese officials are set to meet.
Quick overview
- U.S. stocks achieved record highs, driven by strong corporate earnings and optimism over trade negotiations.
- Approximately 83% of S&P 500 companies exceeded Wall Street expectations, contributing to market gains.
- Investor sentiment was mixed globally, with declines in Asian markets and varied performance in Europe.
- Trade optimism increased following a U.S.-Japan agreement and upcoming discussions between U.S. and Chinese officials.
Trade negotiations remain the main focus for global markets, while U.S. stocks ended the week with broad-based gains.
All three major indexes on the New York Stock Exchange reached fresh record highs on Friday, July 25, capping a week marked by strong corporate earnings and renewed optimism over potential U.S. trade agreements ahead of the August deadline set by President Donald Trump.
Roughly 83% of the 155 S&P 500 companies that have reported so far have surpassed Wall Street expectations, helping push the index to new intraday and closing highs on Thursday, alongside the Dow Jones and Nasdaq.
In this context, the Dow Jones Industrial Average rose 0.5% to 44,901.92 points, the S&P 500 gained 0.4% to 6,390.14, and the Nasdaq Composite advanced 0.2% to 21,108.32.
Global Markets Lag Behind
Elsewhere, investor sentiment was more subdued. In Asia, Hong Kong’s Hang Seng Index fell 1.1%, while Japan’s Nikkei 225 declined 0.9%. China’s CSI 1000 edged up slightly by 0.1%.
European markets were mixed. The Euro Stoxx 50 rose 0.1%, while Germany’s DAX fell 0.3%. Spain’s IBEX 35 dropped 0.2%, the UK’s FTSE 100 slipped 0.2%, and France’s CAC 40 climbed 0.4%.
Trade Optimism Builds
In addition to strong earnings, market confidence was lifted by the announcement of a U.S.-Japan trade agreement, fueling hopes for broader deals before the August 1 tariff deadline.
The European Commission said earlier this week that a negotiated solution was nearing, while U.S. and Chinese officials are set to meet in Stockholm next week to discuss extending the negotiation period.
The U.S. and China had already agreed in May and June to substantially lower mutual tariffs and signed a framework agreement. However, both sides are now aiming for a broader deal, even as U.S. tariffs of 30% to 50% remain in place on Chinese goods.
Earnings in Focus
Investors were also digesting fresh earnings. On Friday, HCA Holdings dropped 2.2% and Charter Communications fell 2.3% after reporting results, while several companies that posted after Thursday’s close remained in the spotlight.
Intel shares plunged 9% after issuing weaker-than-expected guidance for Q3 and announcing job cuts. The chipmaker plans to reduce its workforce to 75,000 by year-end — a 22% decline from the end of 2024 — through attrition and other measures.
On a brighter note, Deckers jumped 12% after reporting better-than-expected Q1 sales, driven by strong performance from its Hoka and Ugg brands.
Paramount Global edged up 0.1% after the FCC approved its $8 billion merger with Skydance Media.
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