The American equity market witnessed a downturn, with both the comprehensive S&P 500 and the tech-centric Nasdaq backing down after setting new record highs shortly after the market opened. Notably, the S&P 500 had recently achieved a series of record-high closes, with its sixth consecutive one occurring on July 28. To date, there have been 15 record-setting closes in the year. The Nasdaq, recognized for its tech concentration, also reached a record-high closure.
Nevertheless, a turn in the tide witnessed a drop in the markets. Still, some market experts anticipate that the S&P 500 will push towards a value of 7,000, up from a sub-6,500 level. The esteemed Dow Jones slipped by 0.46%, equivalent to 204.57 points, settling at 44,632.99. The S&P 500 experienced a drop of 0.3%, or 18.91 points, closing at 6,370.86. In parallel, the Nasdaq decreased by 0.38%, or 80.29 points, and ended at 21,098.29.
The broad-based hit was slightly cushioned due to the rapid slippage in the 10-year Treasury yield to 4.322%. Interestingly, the market saw an uptick after a weekend trade agreement was reached between the European Union and the United States. This agreement included substantial investment pledges by the EU in the US along with a new 15% tariff applied to the vast majority of European goods entering the US.
According to this new agreement, the countries that have yet to establish a trade deal with the US have been given a deadline of August 1 to finalize one. If they fail to do so, a global baseline tariff rate was announced by President Donald Trump, expected to range between 15% and 20%. Complementary to this, Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifen continued their trade discussions in Stockholm, Sweden, supposedly considering the extension of the trade deal deadline.
The early economic reports seemed mostly optimistic. A greater-than-anticipated rise in consumer confidence was recorded in July, complemented by an unexpected shrinkage in the trade deficit in June. Further economic data pointed to fewer job vacancies, though it also indicated a decrease in job resignation rates during June.
In the realm of acquisitions, Union Pacific endeavored to procure Norfolk Southern through an $85 billion cash-and-stock deal, establishing America’s pioneer coast-to-coast rail operator. Norfolk Southern stakeholders are poised to receive one Union Pacific share and $88.82 in cash per Norfolk share. The completion of the deal is expected sometime in the early month of 2027.
Baker Hughes announced its intent to acquire industrial equipment provider Chart Industries Inc. for an estimated $9.6 billion in cash. The goal is to extend its reach into technologies like liquefied natural gas and nuclear power. This agreement will grant Chart shareowners $210 per share and will terminate Chart’s previous merger plan with Flowserve. The transaction is projected to be complete by the middle of 2026.
JPMorgan Chase is reportedly in advanced stages of negotiations to assume control of Apple’s credit-card program. The card, currently held by Goldman Sachs, has amassed around $20 billion in balances. Parallel to this, cybersecurity firm Palo Alto Networks is in discussions to take over provider CyberArk Software.
Breaking corporate news revealed Procter & Gamble’s CEO, Jon Moeller, planned to vacate his position to assume the role of the firm’s executive chairman, effective from January 1, 2026. He is set to be succeeded by CEO Shailesh Jejurikar. There was a furor when it was announced that tariffs could potentially contribute an additional $1 billion to their yearly expenses, despite surpassing quarterly results estimates.
Novo Nordisk issued a stark warning about severely decreased annual outcomes, attributing this to the dwindling demand for its Wegovy obesity drug as generic alternatives seize market shares. Concurrently, Novo Nordisk announced Maziar Mike Doustdar as its future chief executive.
Aircraft manufacturing giant Boeing reported encouraging second-quarter results, landing its most profitable quarter since 2023, thanks to the largest delivery volume since 2018. Likewise, Sarepta Therapeutics informed that the Food and Drug Administration suggested lifting its voluntary halt on Elevidys for ambulatory patients.
However, not all news was positive. The delivery giant UPS revealed its second-quarter sales to be just under estimates, and despite topping sales predictions, adjusted earnings per share fell slightly short. Ongoing economic uncertainties have led it to refrain from providing guidance. Meanwhile, Cadence Design Systems beat predictions with its second-quarter results and issued an optimistic full-year forecast.
Steel producer Nucor failed to meet second-quarter expectations and also predicted slightly lower quarter results ahead. Likewise, appliance creator Whirlpool saw disappointing second-quarter results and issued full-year guidance below market predictions. UnitedHealth projected worse-than-expected full-year results due to inflated medical expenses and missing EPS projections for Q2.
On a more positive note, Royal Caribbean exceeded second-quarter expectations and raised its full-year profit outlook. Meanwhile, Spotify increased its listener base more than analysts had anticipated, though its second-quarter sales fell short. Similarly, Merck missed revenue projections for Q2 and narrowed its full-year outlook, although it plans to cut $3 billion in expenses by the end of 2027.
Finally, Stellantis, the company that produces Jeep, reinstated its financial guidance, expected tariff costs this year to hover around $1.7 billion. Additionally, PayPal reported positive second-quarter results and increased its full-year predictions. Accompanying its financial results, PayPal launched ‘Pay with Crypto,’ enabling consumers to employ a wide array of cryptocurrencies to finish their transactions using wallets like Coinbase and MetaMask. Upon transaction completion, the system will automatically convert the payments to fiat or stablecoin, easing cross-border transactions and reducing transactional costs for enterprises.
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