Dow Jones ends just shy of record close as IBM weighs on futures, trade optimism offsets earnings pressure
U.S. stock futures held steady Wednesday night after the S&P 500 closed at a fresh record high, lifted by renewed hopes for progress on international trade deals.
Futures linked to the benchmark index edged up 0.1%, while Nasdaq 100 futures gained 0.4%. Dow Jones Industrial Average futures fell 104 points, or 0.2%, as IBM shares tumbled following disappointing quarterly results.
Among the “Magnificent Seven” megacap stocks, Alphabet Inc. rose 2% after beating second-quarter earnings and revenue estimates. Tesla Inc. slid 4% in after-hours trading as auto revenue dropped for a second consecutive quarter. IBM Corp. shed 5%, weighing on the Dow, after its software revenue fell short of analysts’ expectations.
Earlier Wednesday, the S&P 500 added 0.78%, marking its 12th record close of the year. The Dow surged 507.85 points, or 1.14%, finishing just four points shy of its own record. The Nasdaq Composite rose 0.61%, closing above the 21,000 mark for the first time.
The market’s momentum was bolstered by reports of progress in trade negotiations. On Tuesday night, former President Donald Trump announced a “massive Deal” with Japan involving 15% reciprocal tariffs on Japanese goods. Meanwhile, the Financial Times and Bloomberg reported advances toward a similar trade agreement between the U.S. and the European Union, which could impose matching tariffs on EU exports.
“These deals are certainly bullish and help maintain market momentum,” said Jeremy Siegel, Wharton School finance professor and senior economist at WisdomTree, speaking on CNBC’s “Closing Bell.”
Investors are awaiting earnings reports from Dow Inc., Honeywell, American Airlines, and Union Pacific on Thursday, along with data on weekly jobless claims, purchasing managers’ index for July, and June’s new home sales.