Market Recap – Thursday, July 17, 2025
Stocks Rise Amid Quiet Trading and Economic Data
Stocks finished higher today, with the Dow, S&P 500, and Nasdaq all posting gains. The Russell 2000, which tracks small-cap stocks, was the biggest winner, advancing by over 1%. The S&P 500 and Nasdaq reached fresh record highs, continuing their upward momentum from earlier in the week. Leading the charge were sectors like beverages, asset management, software, semiconductors, and building products. Big tech stocks mostly had positive performances, with Nvidia (NVDA) taking the lead. On the downside, healthcare, pharma, and telecom stocks saw some pressure, as did sectors like tobacco and casual dining.
Key Market Developments:
Economic Data: Retail sales for June came in stronger than expected, rising 0.6% month-over-month. Excluding auto sales, the increase was 0.5%. This marked a recovery after two months of declines, driven by growth in a variety of categories, including clothing, building materials, and restaurants.
Job Market: Initial jobless claims fell to 221,000, the lowest level since April, indicating continued strength in the labor market.
Fed Watch: The Federal Reserve remains a focal point as President Trump denied rumors of firing Fed Chairman Jerome Powell. Some Fed officials, including Williams, emphasized that the current policy stance remains appropriate, but tariff concerns continue to present potential inflation risks.
Trade Tensions: President Trump’s trade comments continue to create volatility, especially in relation to China, India, and the EU. While a deal with India seems close, the EU is reportedly preparing retaliatory tariffs on US services.
Notable Gainers:
Lucid Group (LCID): +36.2% – The company announced a $300 million investment from Uber for a partnership on autonomous robotaxi programs.
PepsiCo (PEP): +7.5% – Strong earnings growth in North America and raised full-year core EPS guidance.
Sarepta Therapeutics (SRPT): +19.6% – Announced a restructuring plan that includes a 36% workforce reduction and pipeline prioritization.
United Airlines (UAL): +3.1% – Q2 earnings surpassed expectations, although full-year EPS guidance was lowered, citing weaker demand in some areas.
Notable Decliners:
Elevance Health (ELV): -12.2% – Q2 earnings missed expectations, and the company cut its full-year EPS guidance due to higher medical costs.
Sonic Automotive (SAH): -10.4% – Downgraded due to valuation concerns and unfavorable exposure to brands impacted by auto tariffs.
Abbott Labs (ABT): -8.5% – Organic growth fell short, especially in diagnostics, and the company trimmed its full-year EPS guidance.
Here's Our Take:
Today’s market rally was fueled by strong economic data, including a surprising uptick in retail sales and a drop in jobless claims. This, combined with positive earnings reports from key companies, helped push stocks higher. However, the ongoing trade tensions, particularly President Trump’s comments about tariffs on China and the EU, continue to weigh on investor sentiment. While the economy remains resilient, the potential for tariff-driven inflation and concerns over Fed policy keep markets on edge. As earnings season continues, it will be important to watch how companies are navigating these challenges, especially those in sectors sensitive to tariffs and inflation. The next big data points to watch will be Friday’s consumer sentiment report and next week’s housing data, which could offer more insights into the health of the economy.
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