Wall Street ended mixed on Thursday as upbeat results from Alphabet helped push the Nasdaq and S&P 500 to fresh all-time highs, while the Dow came under pressure from earnings misses in major names. Alphabet’s post-earnings rally helped offset weakness in Tesla and IBM, both of which fell sharply after disappointing second-quarter updates. Broader market enthusiasm was tempered by signs of rising inflation tied to tariffs and cautious sentiment around ongoing US-EU trade negotiations. Nevertheless, optimism around AI-driven growth and solid economic data, including lower jobless claims and stronger business activity, continued to support tech stocks and risk appetite.

Key Takeaways:

  • Nasdaq and S&P 500 Close at Record Highs as Alphabet Lifts Tech Sentiment: The Nasdaq Composite climbed 0.18% to 21,057.96 and the S&P 500 edged up 0.07% to 6,363.35, both notching new all-time highs after Alphabet posted a solid earnings beat. Shares rose 1% as the company reported $2.31 per share on $96.43 billion in revenue.
  • Dow Falls Over 300 Points on Tesla and IBM Earnings Misses: The Dow Jones Industrial Average fell 316.38 points, or 0.70%, to 44,693.91 as heavyweight components dragged the index lower. IBM tumbled 7.6% after revenue came in below forecasts, while Tesla slumped 8.2% following a second straight quarter of declining auto revenue and weaker-than-expected earnings.
  • European Markets Close Mixed as ECB Holds Rates and PMI Signals Diverge: The Stoxx 600 added 0.24% to 551.56 while the Euro Stoxx 50 rose 0.3% to 5,359, led by gains in London where the FTSE 100 rallied 0.85% to 9,138.37. In contrast, France’s CAC 40 reversed early strength to close 0.5% lower at 7,813 and Italy’s FTSE MIB slipped 0.2% to 40,600. Frankfurt’s DAX gained 0.1% after the ECB kept interest rates unchanged for the first time in five meetings. The Eurozone PMI climbed to 51 in July, supported by services, while manufacturing remained in contraction. Germany’s services sector improved modestly to 50.1 but factory activity stayed weak at 49.2. France’s composite rose to 49.6, just below the key 50 threshold, while the UK composite moved up to 51.2 as stronger manufacturing offset a slowdown in services.
  • Asia Stocks Rally on Trade Optimism and Resilient Regional Data: Japan’s Topix surged 1.75% to a record 2,977.55 and the Nikkei 225 added 1.59% to 41,826.34, lifted by steady services PMI and easing trade concerns. South Korea’s Kospi advanced 0.21% to 3,190.45, its highest level since August 2021, driven by a rebound in consumer demand and surging tech exports. The Hang Seng rose 0.5% to 25,667.18 and the HSCEI gained 0.2% as investors welcomed signs of progress in US-EU trade talks. Mainland China’s CSI 300 rose 0.71% to 4,149.04, logging its highest close since January 2022 and extending its winning streak to five weeks. Gains were also seen in Singapore (+0.7%), Indonesia (+0.9%), and Malaysia, as regional optimism held firm despite ongoing tariff discussions.
  • US Jobless Claims Drop to 217,000 as Labour Market Holds Steady: Initial claims for unemployment benefits fell by 4,000 last week, surprising forecasters who had expected a rise to 226,000. Continuing claims were broadly stable at 1.955 million, reinforcing views that the job market remains resilient despite slower hiring momentum.
  • US Activity Strengthens but Tariff Pressures Mount on Inflation and Housing: S&P Global’s Composite PMI jumped to 54.6 in July, the strongest since December, fuelled by a surge in services while manufacturing dipped into contraction at 49.5. Rising prices for household goods and appliances pointed to accelerating inflation tied to tariffs. New home sales rose just 0.6% to 627,000 in June, missing expectations and highlighting affordability pressures from higher mortgage rates. Housing inventory climbed to its highest since 2007.
  • Treasury Yields Climb After Robust Data Raises Rate Uncertainty: The 10-year Treasury yield edged up to 4.402% after better-than-expected jobless claims and PMI data. The 2-year yield rose to 3.914% while the 30-year was little changed at 4.947%, as traders weighed the impact of higher inflation readings on the Fed’s next move.
  • Oil Prices Rise on Trade Hopes and Supply Drop: Brent crude gained 67 cents to settle at $69.18 a barrel, while WTI added 78 cents to close at $66.03. Oil was lifted by optimism surrounding a US-EU trade breakthrough and a sharper-than-expected drawdown in US crude inventories. 

FX Today:

  • EUR/USD Stalls Below 1.1800 as Momentum Slows After Four-Week Climb: EUR/USD closed at 1.1765, down 0.05% after reaching a high of 1.1789 and a low of 1.1737. The pair printed a narrow red candle with long wicks, showing hesitation beneath the key 1.1800 resistance zone. Price continues to hold above the 50-day SMA at 1.1546, with the 100-day and 200-day SMAs rising at 1.1322 and 1.0921 respectively. The broader trend remains positive, supported by rising moving averages and a four-week winning streak, but fading momentum and rejection near the July high suggest potential exhaustion. Support is seen at 1.1700 followed by the 50-day SMA. A clear break above 1.1800 would target 1.1880 next, while failure to advance leaves the pair vulnerable to a short-term pullback.
  • GBP/USD Drops Below 50-Day SMA After Firm Rejection at Resistance: GBP/USD closed at 1.3514, falling 0.49% after posting a high of 1.3589 and a low of 1.3505. Price remains supported by the 100-day SMA at 1.3319 and the 200-day SMA at 1.2937, but recent action suggests declining momentum after the rejection from 1.3600. A lower high has now formed below the early July peak at 1.3820, shifting the near-term structure into consolidation. Immediate support is located at 1.3450, with a break below exposing the 100-day average. Bulls must reclaim 1.3530 on a closing basis to revive the upward move.
  • USD/JPY Rebounds From Support But Stays Below 100-Day Average: USD/JPY finished at 146.87, up 0.25% after touching a high of 146.97 and a low of 145.85. The pair bounced off the 50-day SMA at 145.17 but stalled just under the 100-day SMA at 147.00, printing a small green candle with a long lower wick. Despite the rebound, the broader trend remains under pressure, with the 200-day SMA declining at 149.56 and the pair continuing to post lower highs since the July peak at 149.50. A close above 147.00 is needed to reduce pressure and re-target 149.50, while a break below 145.00 would confirm a fresh downside leg and shift focus to 143.50.
  • EUR/GBP Extends Breakout to Four-Month High as Uptrend Accelerates: EUR/GBP settled at 0.8705, up 0.46% after recording a high of 0.8710 and a low of 0.8662. A strong bullish candle confirmed a breakout above the 0.8685–0.8700 resistance zone, delivering the highest close since early April. The pair is supported by a rising 50-day SMA at 0.8531, with the 100-day at 0.8497 and 200-day at 0.8412 also trending higher. A steady sequence of higher highs and higher lows remains in place since mid-June, underlining strong bullish momentum. Immediate support lies at 0.8660, while the next resistance target is 0.8745. 
  • Gold Retreats From $3,393 as Resistance Holds and Momentum Wanes: Gold ended at $3,372, down 0.48% after reaching a high of $3,393 and a low of $3,352. A second red candle confirmed rejection from the top of the recent range, where bullish momentum has repeatedly stalled. Price continues to trade above the 50-day SMA at $3,331, with the 100-day at $3,234 and the 200-day at $2,975 providing longer-term support. The uptrend remains intact, but repeated failures to hold above $3,390 suggest growing overhead pressure. If $3,330 fails to hold, a deeper correction toward the 100-day average could follow. A close back above $3,393 would reopen the path toward $3,440–$3,455.

Market Movers:

  • Chipotle Plunges After Cutting Sales Outlook: Chipotle shares fell 13% as the company lowered its same-store sales forecast and missed quarterly revenue estimates.
  • Union Pacific Falls Amid Merger Talks With Norfolk Southern: Union Pacific declined 4.5% after confirming it is in advanced discussions to merge with Norfolk Southern, which edged down less than 1%, in a deal that could reshape US freight rail.
  • UnitedHealth Group Falls on DOJ Medicare Probe: Shares of UnitedHealth dropped 4.8% following confirmation that the company is cooperating with a US Department of Justice investigation into its Medicare billing practices.
  • West Pharmaceutical Jumps After Upbeat Guidance: Shares of West Pharmaceutical soared 22.8% after the company raised its full-year profit forecast, citing reduced tariff impact and improved demand across key segments.
  • Bloom Energy Soars on Oracle Power Deal: Bloom Energy surged 23% after announcing a strategic agreement to provide onsite energy solutions for Oracle’s AI data centres, sparking optimism over broader enterprise demand.
  • Dow Inc. Tumbles on Deep Earnings Miss: Dow Inc. plunged 17% after posting a loss of 42 cents per share on $10.1 billion in revenue, missing analyst estimates and reflecting broad weakness in the chemicals segment.
  • Molina Healthcare Crashes on Earnings Miss: Molina Healthcare plunged 16.8% after missing earnings forecasts, reporting adjusted earnings of $5.48 per share compared to the $5.79 expected by analysts surveyed by LSEG.

With markets hovering at record levels and earnings season in full swing, investor focus is turning toward the durability of the rally amid conflicting signals. Strong tech results have provided fuel for further gains, but steep declines in high-profile names show how quickly sentiment can reverse. Central banks remain cautious, and tariff-linked inflation pressures are beginning to emerge just as housing data reveals cracks in consumer resilience.