Wall Street kicks off a week full of potential flashpoints with a
whisper
[July 29, 2025] By
STAN CHOE
NEW YORK (AP) — U.S. stock indexes drifted through a quiet Monday after
the United States agreed to tax cars and other products coming from the
European Union at a 15% rate, lower than President Donald Trump had
earlier threatened. Many details of the trade deal are still to be
worked out, and Wall Street is heading into a week full of potential
flashpoints that could shake markets.
The S&P 500 was nearly flat and edged up by less than 0.1% to set an
all-time high for a sixth straight day. The Dow Jones Industrial Average
dipped 64 points, or 0.1%, while the Nasdaq composite added 0.3% to its
own record.
Tesla rose 3% after its CEO, Elon Musk, said it signed a deal with
Samsung Electronics that could be worth more than $16.5 billion to
provide chips for the electric-vehicle company. Samsung’s stock in South
Korea jumped 6.8%.
Other companies in the chip and artificial-intelligence industries were
strong, continuing their run from last week after Alphabet said it was
increasing its spending on AI chips and other investments to $85 billion
this year. Chip company Advanced Micro Devices rose 4.3%, and
server-maker Super Micro Computer climbed 10.2%.
But an 8.3% drop for Revvity helped to keep the market in check. The
company in the life sciences and diagnostics businesses reported a
stronger profit for the latest quarter than Wall Street expected, but
its forecast for full year profit disappointed analysts.
Companies are broadly under pressure to deliver solid growth in profits
following big jumps in their stock prices the last few months. Much of
the gain was due to hopes that Trump would walk back some of his stiff
proposed tariffs, and critics say the U.S. stock market looks expensive
unless companies produce bigger profits.
All told, the S&P 500 added 1.13 to 6,389.77 points. The Dow Jones
Industrial Average dipped 64.36 to 44,837.56, and the Nasdaq composite
rose 70.27 to 21,178.58.
More fireworks may be ahead this week. “This is about as busy as a week
can get in the markets,” according to Chris Larkin, managing director,
trading and investing, at E-Trade from Morgan Stanley.
Hundreds of U.S. companies are lined up to report how much profit they
made during the spring, with nearly a third of the businesses in the S&P
500 index scheduled to deliver updates. That includes market
heavyweights Apple, Amazon, Meta Platforms and Microsoft. Those
companies have grown so huge that their stock movements can almost
dictate what the overall S&P 500 index does. Microsoft alone is worth
$3.8 trillion.
On Wednesday, the Federal Reserve will announce its latest decision on
interest rates.
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Trader Steven Gohl works on the floor of the New York Stock
Exchange, Monday, July 21, 2025. (AP Photo/Richard Drew)
 Trump has been angrily calling for
the Fed to cut interest rates, a move that could give the economy a
boost. But Fed Chair Jerome Powell insists that he wants more data
about how Trump’s tariffs are affecting the economy and inflation
before the Fed makes its next move. Lower interest rates can fuel
inflation, and the economy only recently came out of its scarring
run where inflation briefly topped 9%.
The widespread expectation on Wall Street is that
Fed officials will wait until September to resume cutting interest
rates, though a couple of Trump’s appointees could dissent in the
vote. The Fed has been on hold with interest rates this year since
cutting them several times at the end of 2024.
This week will also feature several potentially market-moving
updates about the economy. On Tuesday will come reports on how
confident U.S. consumers are feeling and how many jobs openings U.S.
employers were advertising. Wednesday will show the first estimate
of how quickly the U.S. economy grew during the spring, and
economists expect to see a slowdown from the first three months of
the year.
On Thursday, the latest measure of inflation that the Federal
Reserve prefers to use will arrive. A modest reading could give the
Fed more leeway to cut interest rates in the short term, while a
hotter-than-expected figure could make it more cautious.
And Friday will bring an update on how many more workers U.S.
employers hired during June than they fired.
Treasury yields held relatively steady in the bond market ahead of
all that action. The yield on the 10-year Treasury edged up to 4.41%
from 4.40% late Friday. The two-year Treasury yield, which more
closely tracks expectations for Fed action, rose to 3.92% from
3.91%.
In stock markets abroad, indexes dipped in Europe following the
announcement of the trade deal’s framework.
Chinese stocks rose as officials from the world’s second-largest
economy prepared to meet with a U.S. delegation in Sweden for trade
talks. Stocks climbed 0.7% in Hong Kong and 0.1% in Shanghai.
Indexes were mixed across the rest of Asia, where Japan’s Nikkei 225
fell 1.1% for one of the world’s bigger losses.
___
AP Business Writer Elaine Kurtenbach contributed.
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