Another week, another round of record highs
U.S. stocks closed out a winning week on Friday, propelled by strong corporate earnings and optimism over international trade deals. The S&P 500 rose 0.40% to a new peak of 6,388.64—marking its 14th record close this year and its fifth in a row. The Nasdaq Composite also hit a fresh high, gaining 0.24% to finish at 21,108.32. The Dow Jones Industrial Average added 208 points, or 0.47%, ending just shy of its all-time close.
All three major indexes not only recorded weekly gains but broke multiple intraday records during the week. The Dow climbed 1.3%, the Nasdaq ticked up 1%, and the S&P 500 led the pack with a 1.5% boost.
Fundamentals remain king
What’s driving this sustained market momentum? Analysts point to stable inflation, range-bound interest rates, and a surprisingly strong earnings season. Of the 169 S&P 500 companies that have reported so far, 82% have exceeded Wall Street’s expectations, according to FactSet. Tech titan Alphabet surged 4% following its robust quarterly report, while Verizon saw a 5% gain after its earnings beat.
“The bull market lives on,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. “Inflation is stable, interest rates are range-bound and earnings are trending higher.”
Trade winds blowing favorably… for now
Adding to market enthusiasm, recent trade developments out of Washington caught investors’ attention. President Donald Trump announced a “massive” deal with Japan this week, touting reciprocal 15% tariffs. He also revealed that the U.S. has reached a framework agreement with Indonesia.
And there may be more on the way. Trump teased additional deals ahead of the August 1 tariff deadline, hinting at progress with the European Union. European Commission President Ursula von der Leyen confirmed plans to meet with Trump in Scotland on Sunday.
Still, uncertainties linger. Tariffs remain a thorny issue. “You look at geopolitical challenges,” Sandven noted, “whether it be Russia-Ukraine, Israel-Iran and the like… through all that, the equity market has trended higher.”
Next week, all eyes turn to the Federal Reserve meeting, where policymakers are expected to keep rates steady in the 4.25%–4.5% range. It’s also set to be the busiest stretch of earnings season, with 150 companies—including Apple and Meta—due to report.
Europe Falters Amid Trade Tensions and Tepid Economic Data
Across the pond, markets struggled.
European equities posted a mostly downbeat performance on Friday as investors weighed mixed earnings and stalled trade negotiations with the U.S. The pan-European Stoxx 600 dipped 0.24%, with major indexes like the U.K.’s FTSE 100 and Germany’s DAX declining modestly. France’s CAC 40 rose just 0.17%.
Concerns centered around slow progress on trade talks and a looming August 7 deadline for EU countermeasures on €93 billion in U.S. goods—contingent on the success of ongoing negotiations.
Earnings disappointments added pressure. In Germany, Puma plunged 16% after slashing its forecast due to weak demand and U.S. tariff concerns. In France, Michelin and Publicis Groupe posted notable declines, while Carrefour surged more than 5% on solid quarterly revenue.
Retail sales in the U.K. ticked up in June thanks to warmer weather but fell short of economist forecasts. Meanwhile, consumer confidence slipped, raising concerns about inflation and tax pressures.
Economic data offered glimmers of hope.
Germany’s Ifo Business Climate Index nudged up to 88.6 in July, its highest reading since May 2024. French consumer sentiment also edged higher, while the U.K.’s retail recovery pointed to a cautiously resilient outlook despite headwinds.