On Monday, major U.S. stock indexes ended the day with gains, with the S&P 500 and Nasdaq 100 reaching new all-time highs. The market was supported by a drop in the 10-year Treasury yield, which fell to a one-week low of 4.37%. This eased pressure on equities and fueled buying, particularly in the technology sector.
An additional boost came from strong performance in the semiconductor industry, which lifted the broader tech sector and contributed to overall market gains.
Key Drivers of the Rally
Investors focused on index reshuffles and revised corporate guidance:
Block shares jumped over 7% after the announcement that it would join the S&P 500, replacing Hess Corp.
Verizon Communications rose more than 4% following an upward revision to the lower end of its full-year profit forecast.
Pinterest and Dollar Tree both gained over 2% after receiving analyst upgrades from Morgan Stanley and Barclays, respectively.
Semiconductor stocks — including ARM Holdings, Qualcomm, Broadcom, NXP Semiconductors, Lam Research, and Applied Materials — all posted solid gains, ranging from 1% to over 3%.
Declining Stocks
Not all sectors followed the upward trend. The energy sector was notably weak:
Natural gas futures dropped more than 6%, triggering a sharp sell-off in companies such as EQT Corp, Antero Resources, Cheniere Energy, and Coterra Energy, with declines ranging from 5% to over 10%.
Other notable losers included:
Sarepta Therapeutics, which fell over 5% after reports of patient deaths related to its Elevidys gene therapy.
Molina Healthcare, Biogen, and Centene, all of which declined after receiving rating downgrades.
American Express, down more than 1% following a $4 billion bond offering.
Trade Policy Adds Uncertainty
Investor sentiment remains cautious due to recent comments from President Trump, who warned of new tariffs taking effect on August 1:
Up to 35% on certain Canadian goods,
30% on imports from the EU and Mexico,
10–15% on products from more than 150 countries.
These announcements have heightened concerns about escalating global trade tensions.
Macro Outlook
This week, several key economic reports are expected:
Wednesday: Existing home sales (forecasted to decline),
Thursday: Weekly jobless claims and S&P manufacturing PMI (expected to weaken),
Friday: Durable goods orders (modest increase anticipated).
In addition, the earnings season continues, with about 20% of S&P 500 companies scheduled to report quarterly results, including tech giants Alphabet and Tesla. According to early estimates, overall S&P 500 earnings are expected to grow by 3.2% year-over-year in Q2 — better than the 2.8% forecast at the start of the season.
Bond Market and Rate Expectations
Falling Treasury yields in the U.S. and Europe provided further support to equities. The 10-year U.S. yield dropped to 4.37%, German bunds to 2.61%, and U.K. gilts to 4.60%.
Meanwhile, expectations for a Fed rate cut at the July 29–30 FOMC meeting have declined. Futures now price in just a 3% chance of a 25-basis-point cut, with a 58% probability for a rate reduction in September.
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