| | | Market Snapshot
| Dow | 44240.76 | -165.60 | (-0.37%) | | Nasdaq | 20418.47 | +5.95 | (0.03%) | | SP 500 | 6225.52 | -4.46 | (-0.07%) | | 10-yr Note |
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| | NYSE | Adv 1707 | Dec 1035 | Vol 1.24 bln | | Nasdaq | Adv 2852 | Dec 1718 | Vol 8.5 bln |
Industry Watch
| Strong: Energy, Health Care, Information Technology, Materials, Industrials |
| | Weak: Utilities, Consumer Staples, Financials, Communication Services, Consumer Discretionary, Real Estate |
Moving the Market
Ongoing trade deal negotiations as President Trump extends tariff deadline to August 1
Strong performance in small-cap and mid-cap stocks
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Closing Market Summary
08-Jul-25 16:45 ET
Dow -165.60 at 44240.76, Nasdaq +5.95 at 20418.47, S&P -4.46 at 6225.52
[BRIEFING.COM] A lack of major developments on the trade front coupled with a balance between small-cap and mid-cap outperformance and mega-cap underperformance kept the major averages within a tight range of flat opening levels following yesterday's consolidation activity.
After signing an executive order officially postponing the July 9 trade deadline, President Trump said there will be no extensions past August 1 for countries that got letters yesterday and for countries that will receive letters today, tomorrow, and for the next short period of time.
Commerce Secretary Howard Lutnick said in a CNBC interview that the EU has made "significant real offers" to open up markets to the U.S., though initial reports now suggest that the EU will receive a letter from the Trump administration in the coming days.
Altogether, the developments on the trade front were in line with expectations and did little to sway the broader markets, though President Trump's actions today did have some sector-specific impacts.
Copper prices surged and copper futures settled up $0.56, or 11.2%, at $5.58/lb after President Trump announced a 50% tariff on copper that will likely start August 1. Shares of Freeport-McMoRan (FCX 46.29, +1.16, +2.57%) traded sharply higher following the announcement, and helped the materials sector (+0.8%) emerge as one of the best performers.
Oil companies in the top-performing energy sector (+2.7%) benefitted from President Trump signing an Executive Order to eliminate subsidies for "green" energy sources like wind and solar "in furtherance of the One Big Beautiful Bill Act."
ConocoPhillips (COP 95.65, +3.10, +3.35%), Chevron (CVX 152.93, +5.53, +3.75%), and Exxon Mobil (XOM 114.14, +3.03, +2.73%) all captured gains following the order and in conjunction with an increase in oil prices that saw crude oil futures settle up 0.5% to $68.30 per barrel.
Though the market as a whole traded relatively flat throughout the session, there were some noticeable trends that kept the major averages stable.
Notably, small-cap and mid-cap stocks outperformed the mega-caps, as the Russell 2000 (+0.7%) and the S&P Midcap 400 (+0.5%) outperformed the S&P 500 (-0.1%), while the Vanguard Mega Cap ETF (-0.15%) lagged. Positive breadth figures in which advancers outpaced decliners by a nearly 2:1 ratio on the NYSE and the Nasdaq further evidenced this trend.
The financials sector (-0.9%) was among the weakest performers due in part to its mega-cap components, as HSBC downgraded JPMorgan Chase (JPM 282.66, -9.31, -3.2%), Bank of America (BAC 47.14, -1.52, -3.1%), and Goldman Sachs (GS 697.04, -13.88, -2.0%).
Tesla (TSLA 297.81, +3.87, +1.32%) rebounded from yesterday's unfavorable press, but a poor performance from top component Amazon (AMZN 219.33, -4.14, -1.9%) kept the consumer discretionary sector (-0.6%) out of positive territory following reports that Amazon's initial prime day sales were down 14% from last year's figure.
Additionally, underperformance from Apple (AAPL 210.01, +0.06, +0.0%) and Microsoft (MSFT 496.62, -1.10, -0.2%) stifled further gains in the technology sector (+0.4%) despite an impressive showing from chip stocks that saw the PHLX Semiconductor Index close with a 1.8% gain, nearly negating yesterday's loss of 1.9%.
U.S. Treasuries saw some modest selling pressure today, most of which occurred ahead of the cash session. The cash session was dictated by little change across the curve despite a relatively weak 3-yr note auction and talk of more tariffs (and tariff letters) coming soon. A New York Fed survey showing a downtick in short-term inflation expectations, though, offered a measure of support in conjunction with a prevailing belief that better trade deals will ultimately be announced and that tariffs for major trading partners will be less onerous than feared.
The market will look to further developments on the trade front and the release of FOMC minutes tomorrow in hopes of shaking its relatively sluggish start to the week.
- S&P 500: +5.9% YTD
- Nasdaq: +5.7% YTD
- DJIA: +4.0% YTD
- S&P 400: +1.6%YTD
- Russell 2000: -0.1% YTD
Reviewing today's economic data:
- June NFIB Small Business Optimism Index held fairly steady at 98.6 (prior 98.8)
- The high yield of 3.891% at the $58 bln 3-yr note auction tailed the when-issued yield of 3.887% on weak demand from indirect bidders
- May Consumer Credit $5.1 bln following a downwardly revised $16.9 bln (from $17.9 bln) in April.
- The increase was driven entirely by nonrevolving credit, which was up $8.6 bln.
Little changed heading into final hour
08-Jul-25 15:30 ET
Dow -138.00 at 44268.36, Nasdaq -10.07 at 20402.45, S&P -4.56 at 6225.42
[BRIEFING.COM] The major averages hover just below their unchanged values, with the S&P 500 down 0.1%.
The overarching trends of today's trade are holding as the market heads into the final hour of trading, notably that small-cap and mid-cap stocks are outperforming the broader market on a day with decidedly positive breadth figures, as the mega-caps underperform.
Shares of mining company Freeport-McMoRan (FCX 46.48, +1.35, +3.0%) ticked higher after President Trump announced a 50% tariff on copper, which has helped the materials sector (+0.7%) emerge as one of the strongest performers of the day.
A closer look at the May Consumer Credit, which showed an increase of $5.1 bln following a downwardly revised $16.9 bln (from $17.9 bln) in April, shows the increase was driven entirely by nonrevolving credit, which was up $8.6 bln.
Copper surges following tariff announcement
08-Jul-25 15:05 ET
Dow -142.36 at 44264.00, Nasdaq +2.03 at 20414.55, S&P -3.19 at 6226.79
[BRIEFING.COM] The S&P 500 continues to oscillate within a relatively tight range around its flat opening, currently down 0.1%.
There has been little in the way of new developments around trade deals, and the headlines that have come through are generally in line with expectations.
Commerce Secretary Howard Lutnick said in a CNBC interview that the EU has made "significant real offers" to open up markets to the U.S., and an additional 15-20 tariff letters will go out over the next two days. Lutnick speculated that President Trump will cut tariff rates with a few other countries.
Additionally, the U.S. and China will meet in early August to have a bigger conversation on trade.
The 232 Commerce Department investigation on copper has concluded, meaning President Trump has the ability to impose tariffs at 50% on copper. Tariffs on copper will likely start on August 1.
Copper prices surged following the President's announcement of the 50% tariff, as copper futures settled up $0.56, or 11.2%, at $5.58/lb.
Just released, Consumer Credit for May increased by $5.1B (Briefing.com consensus $8.6B) from a downwardly revised $16.9B (from $17.9B) in April.
S&P 500 inches up; MRNA, ALB, ON lead gains, FICO sinks 16% on FHFA shift
08-Jul-25 14:30 ET
Dow -116.09 at 44290.27, Nasdaq +30.59 at 20443.11, S&P +2.46 at 6232.44
[BRIEFING.COM] The S&P 500 (+0.04%) is in second place on Tuesday afternoon, up about 3 points.
Briefly, S&P 500 constituents Moderna (MRNA 32.80, +2.90, +9.70%), Albemarle (ALB 71.58, +6.08, +9.28%), and onsemi (ON 57.73, +3.12, +5.71%) dot the top of the standings despite a dearth of corporate news.
Meanwhile, Fair Isaac (FICO 1573.10, -296.73, -15.87%) is hit hard on comments from FHFA Director William Pulte that Fannie Mae (FNMA 9.21, +0.06, +0.66%) and Freddie Mac (FMCC 7.72, +0.01, +0.13%) will now allow lenders to use the VantageScore 4.0, a competing credit scoring model co-developed by Experian (EXPGY 53.17, +0.81, +1.56%), Equifax (EFX 264.81, +0.73, +0.28%), and TransUnion (TRU 93.55, +2.05, +2.24%), without requiring new infrastructure.
Gold slips 0.8% as Trump tariff shock spurs safe-haven demand, but strong yields cap upside
08-Jul-25 14:00 ET
Dow -122.35 at 44284.01, Nasdaq +35.29 at 20447.81, S&P +2.91 at 6232.89
[BRIEFING.COM] The Nasdaq Composite (+0.17%) is modestly higher on Tuesday afternoon, up about 35 points.
Gold futures settled $25.90 lower (-0.8%) at $3,316.90/oz, as traders cautiously pared positions amid volatility in real yields and a strong dollar. The driver behind Tuesday's move was heightened safe-haven demand linked to President Trump's announcement of 25% tariffs on imports from 14 countries, effective August 1, which stoked geopolitical uncertainty. However, gains were constrained by firm Treasury yields and a robust U.S. dollar, underscoring the delicate balance between risk-off sentiment and rising opportunity costs in holding bullion.
Meanwhile, the U.S. Dollar Index is down less than -0.1% to $97.52.
Kick off your portfolio as the FIFA Club World Cup heads into its final week
While many are familiar with the World Cup, the Club World Cup may be less well known. After its relaunch in 2005, it became an annual event until 2023. Now, in 2025, it has been revamped into a larger tournament featuring 32 teams from all six confederations, held every four years, similar to the World Cup format.
The 2025 Club World Cup is being hosted in the US. With the event in its final week and the highly anticipated 2026 World Cup taking place in the US as well, we thought it may be good to look at some companies that have a lot of exposure to these events.
- One clear beneficiary from these events is the suppliers of apparel and equipment. The majority of kit (uniforms, equipment etc.) providers in the Club World Cup are Nike (NKE), Adidas (ADDYY), and Puma. Adidas, which also provides the official match ball, has replicas available in stores and online. According to the FIFA website, the 57 licensed stores across the 12 venues sell replica kits, t-shirts, scarves, and related collectibles and memorabilia of the event. The venues have sold nearly 119,000 units, with T-shirts and club scarves among the best sellers.
- Sponsors have also benefited from the event. Coca-Cola (KO) has delivered almost 1 mln products and over 320 fridges to 70 key locations across the tournament. Additionally, Lenovo (LNVGY) has over 9,000 devices and accessories in use across all stadiums and tournament sites.
- Other industries to benefit include the hospitality industry. With the Club World Cup taking place across 12 states and 11 cities, and clubs from around the world participating, people from all places have an interest in these games. Companies like Marriot (MAR), Hilton (HLT), Hyatt (H), as well as other travel stocks like AirBnB (ABNB) are worth watching. Also travel websites like Expedia (EXPE) and Booking.com (BKNG). Hopefully, the Club World Cup will be able to offset some of the reduction we have seen from fewer foreigners visiting the US in 2025. So far, there have been more than 46,300 hospitality guests, with 44.2% of the sales to international clients, notably from the UK, Qatar, Saudi Arabia, and Brazil.
- On a final note, the event has generated a lot of buzz digitally. The FIFA website has seen 16 million unique visitors in June, more than in the previous 5 months. Additionally, the content posted across social media platforms has made 2.7 bln impressions, boosting visibility for sponsors and affiliated brands. This could be good for online ad companies like TTD and MGNI.
With the 2025 Club World Cup in its final stretch and the 2026 World Cup on the horizon, global enthusiasm for soccer is heating up. The companies helping to bring these events to life are likely to benefit from the excitement generated by these soccer events. Investors may want to keep an eye on these companies as there is likely to be positive commentary on the Q2 calls coming up in a few weeks.
Exxon Mobil braces for 2Q25 earnings hit as weak crude oil prices weigh on upstream results (XOM)
Exxon Mobil’s (XOM) disclosure of factors expected to impact its 2Q25 results highlights softer crude oil and natural gas prices as significant headwinds, driven by increased crude supply from OPEC+’s decision to unwind production cuts. Over the past three months, Brent crude prices have declined by over 10%, averaging around $67 per barrel, reflecting oversupply concerns and weaker global demand signals, exacerbated by OPEC+’s planned output hike.
Despite these pressures, XOM has partially offset the impact through robust production growth, particularly from its Permian Basin assets, bolstered by the $60 bln acquisition of Pioneer Natural Resources in May 2024. The company’s record Permian output, combined with strong performance in Guyana, has driven a 20% yr/yr increase in net production to 4.6 mln oil-equivalent barrels per day, providing a critical buffer against declining commodity prices.
- In its upstream segment, XOM anticipates a yr/yr earnings decline of $800 mln to $1.2 bln due to lower crude oil prices and a further $300 mln to $700 mln reduction from weaker natural gas prices. These projections reflect the challenging commodity price environment, with U.S. natural gas prices remaining volatile amid high inventories and subdued demand forecasts.
- For 1Q25, upstream non-GAAP earnings rose by $1.1 bln yr/yr to $6.8 bln, despite softer crude realizations, driven by a 767,000 oil-equivalent barrels per day production increase, primarily from the Pioneer acquisition’s contribution to Permian growth. This underscores XOM’s ability to leverage advantaged assets to mitigate price volatility, though the magnitude of 2Q25 price declines may outpace volume gains, pressuring segment profitability.
- The Energy Products segment, encompassing refining and fuels, is expected to see a modest earnings increase of $100 mln to $500 mln yr/yr in 2Q25, driven by improved industry refining margins. In 1Q25, this segment rebounded from a weak 4Q24, with earnings rising $425 mln qtr/qtr to $827 mln, fueled by stronger North American refining margins due to unplanned industry outages and favorable timing effects from derivatives.
- In 2Q25, refining margins continued to improve, supported by persistent supply constraints from maintenance turnarounds and geopolitical disruptions affecting global fuel markets, alongside steady U.S. demand for gasoline and diesel. However, the segment’s upside remains limited compared to the historically high margins of 2023, as new refinery capacity in Asia and Africa gradually comes online, potentially capping further gains.
- XOM’s structural cost savings program has been a critical factor in cushioning the impact of declining oil and gas prices, with cumulative savings reaching $12.7 bln since 2019, including $600 mln in 1Q25 alone. The company remains on track to achieve $18 bln in savings by 2030, outpacing peers and offsetting inflationary pressures and growth-related expenses. These efficiencies, combined with high-return investments in Permian and Guyana, have enhanced earnings resilience.
- However, the company’s adjusted EPS is still projected to decline 16% yr/yr to $6.58 for 2Q25, reflecting the significant drag from commodity prices. With Brent crude potentially facing further downside risk in 2025 due to global demand uncertainties and OPEC+ supply dynamics, XOM’s earnings estimates remain vulnerable.
Softening crude oil and natural gas prices pose a formidable headwind for XOM’s 2Q25 performance, a challenge shared across the oil and gas sector. While rising production from advantaged assets and ongoing structural cost reductions will mitigate these pressures, XOM’s earnings are still expected to contract, underscoring the persistent impact of commodity price volatility.
Skyworks has been buying back stock following previously-announced loss of Apple business (SWKS)
Skyworks Solutions (SWKS +4%) is a member of our YIELD leaders rankings, which focuses on companies that are good about returning cash to shareholders via share buybacks and dividends. Skyworks caught our eye because the stock has pulled back pretty aggressively in recent months, but management has been buying back stock at a good clip.
- The stock gapped lower in early February following its Q1 (Dec) report. The results were decent, but the bigger problem was Skyworks announcing that it was losing business with Apple (AAPL), its largest customer. The company explained that the last couple years have been challenging as the competitive landscape has intensified.
- Regarding the new iPhone launch expected this fall, Skyworks was able to secure multiple sockets, including several highly integrated RF modules. However, its content position is expected to be down 20-25%. This decline will start impacting revenue in Q4 (Sep) and throughout FY26. Analysts believe Broadcom (AVGO) is capturing this share with Apple.
- Looking ahead, Skyworks has already started developing a new suite of products for the next generation iPhone and it's continuing to pursue growth with its other mobile customers, although on a selective basis. Skyworks is focusing on those segments of the market that demand high performance RF. The company also noted that it continues to diversify, which should partially offset the revenue decline at Apple in FY26 and position the company for growth in FY27.
- The company also named a new CEO, Philip Brace, who took the helm in February 2025. Brace has extensive experience in the semiconductor, server, IoT and storage industries and has held various roles across software, hardware, engineering, marketing and sales. He served as executive chairman of Inseego since February 2024 and, before that, he was CEO of Sierra Wireless, where he led the company through significant operational improvements.
Clearly, the reduction in content in the iPhone was a big blow to Skyworks. It sounds like they are trying to reclaim some of that share, but that could be difficult to accomplish. Hopefully, it can recoup some of these losses with its other mobile customers. Also, Skyworks has exposure to other areas, including automotive, edge IoT, and Wi-Fi 7 adoption across consumer and enterprise devices. Hopefully, the new CEO can right the ship. In terms of share buybacks, the company has taken advantage of the pullback in its shares. In Q2 (Mar), it returned a record $600 mln to shareholders through share repurchases and dividends.
Honeywell to evaluate divestitures of PSS and WWS, aligning with portfolio simplification goal (HON)
Honeywell (HON) announced its intention to evaluate strategic alternatives for its Productivity Solutions and Services (PSS) and Warehouse and Workflow Solutions (WWS) businesses, aligning with its ongoing portfolio streamlining strategy, and ahead of the planned separation of Solstice Advanced Materials by late 2025 or early 2026 and Honeywell Aerospace in the second half of 2026.
This move reflects a deliberate effort to simplify the company’s structure, focusing on high-growth, high-margin businesses to accelerate value creation for shareholders. By divesting or spinning off non-core units, HON aims to enhance operational efficiency, sharpen capital allocation, and unlock trapped value within its diversified portfolio, potentially leading to higher valuations for its remaining businesses and improved shareholder returns.
- The PSS business provides mobile computing, data collection, and software solutions, primarily serving retail, healthcare, and transportation sectors with technologies like barcode scanners and rugged mobile devices. WWS, meanwhile, focuses on warehouse automation, offering systems such as conveyor belts, robotic picking solutions, and warehouse management software, catering to e-commerce and logistics industries. HON’s decision to explore strategic alternatives for these units likely stems from their distinct operational profiles and market dynamics, which differ from its core industrial and aerospace focus.
- Both businesses operate in competitive, fast-evolving markets requiring significant R&D and capital investment to maintain leadership, potentially straining HON’s resources. Divesting or partnering these units could allow HON to redirect capital toward higher-return opportunities while enabling PSS and WWS to thrive under ownership better suited to their specialized needs.
- Financially, PSS and WWS are significant contributors to HON’s Automation segment, which generated approximately $4.8 bln in revenue in 2024, with PSS and WWS estimated to account for roughly $2.5-$3 bln combined. Operating margins for these businesses are solid, likely in the mid-teens, driven by steady demand for automation solutions, though below HON’s core aerospace margins (20-25%). Their growth has likely been muted, as illustrated by HON's Industrial Automation business experiencing organic net sales growth of -7% in 2024, while capital intensity and competitive pressures may also limit upside potential relative to HON’s other units.
- Still, given their scale, technological leadership, and exposure to high-growth sectors, both businesses are likely to attract healthy interest from strategic buyers (e.g., Zebra Technologies, Rockwell Automation) and private equity firms with expertise in automation and tech.
- Post-separations, HON is poised to emerge as a leaner, more focused industrial technology company, centered on its Building Technologies and remaining automation businesses, alongside a standalone Aerospace entity and Solstice Advanced Materials as separate public companies. The Honeywell Automation business (the "remaining" Honeywell after the spin-offs) is projected to generate $18 bln in annual revenue based on 2024 figures, with an operating margin target likely be aligned with or exceed the 20% mark, given their focus on high-value automation. Meanwhile, the Honeywell Aerospace business is projected to generate $15 bln in annual revenue with operating margins potentially exceeding 25%.
HON’s evaluation of strategic alternatives for PSS and WWS is a strategic step to refine its portfolio, aligning with its broader streamlining efforts. By unlocking value from these businesses, HON aims to enhance shareholder returns while positioning itself as a more focused, high-margin industrial leader.
Amazon Prime Day is likely to set investor expectations heading into back-to-school season
Amazon (AMZN) is preparing to have its biggest sales event of the year as Prime Day kicks off this week. This year, the event is extended to last four days from July 8-11 and arrives a week earlier. Beyond the sales boost, Prime Day will serve as a critical measure for consumer demand, inventory trends, and digital retail, offering early reads on back-to-school shopping and the trajectory for Q3 retail.
- Last prime day was AMZN's largest and most successful, helping customers save over $5 bln across more than 50 mln deals. Additionally, AMZN saw paid membership growth accelerate yr/yr in Q3FY24 in both the US and internationally.
- During these dog days of summer, it has been a retail tradition to have these sale events that capitalize on the holidays, summer season, and back-to-school shopping. As to not miss out on the action, Walmart (WMT) will have its Walmart Deals event run from July 8-13, and Target (TGT) has its Circle Week from July 6-12.
- Last year, Circle Week generated the highest digital traffic of FY24 for Target, adding over 2 mln new Target Circle members. Additionally, comp sales were strongest in June and July, driven by the event. Investors will want to see a continuation of the event's success this year.
- In terms of how the consumer feels going into these events, the final University of Michigan Index of Consumer Sentiment edged up to 60.7 for June. This was an improvement in current sentiment, boosted by an improved view of personal finances, business conditions, and the inflation outlook.
- There has been attention on the July 9 expiration date for the pause on reciprocal tariffs, but recent reports suggest there is some discussion around that date, with August 1 now projected as the date countries need to make a deal with the U.S. With that said, these events will be important for shoppers as they try to beat the higher tariff rates.
Overall, these sale events rank among the largest of the year for these companies. The stocks have edged higher over the last couple of days, telling us that sentiment is running high going into these high-profile events. Beyond just the sales, these events will provide critical insights into consumer demand and set investor expectations for Q3 retail performance.
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