This week is going to be massive in terms of trade deals, data releases and earnings. US stock futures rose following Trump’s announcement of a new trade agreement with the EU, which includes a 15% tariff on European goods, half the initial 30% threat. Last week, the US stock market ended on a high note, with the S&P 500 and Nasdaq Composite closing Friday at all-time highs.
Overall, the bull case for equities is strengthening due to a calmer trade tone and the continued progress of deals.
The US economy remains robust, and earnings season continues strong. “Frankly, it’s tough to bet against the market continuing to print record highs for the time being, though this week’s megacap earnings are, of course, a risk on that front,” says Michael Brown Senior Research Strategist at Pepperstone.
Nigel Green, CEO of global financial advisory giant deVere Group says, “Global equity markets are surging on Monday — not because tariffs disappeared, but because they finally crystallised.
The global economy is being redrawn in real time. Trade routes are shifting. Capital flows are reorienting. Energy and defence are now the price of access to the US market. Capital is going to follow with certainty. We expect a near-term rotation into US defence and energy stocks, and selective upside in EU firms that pivot early.”
This Week’s Events
This week’s economic and corporate calendar is jam-packed with events, including the Fed’s interest-rate decision, July jobs data, a crucial tariffs deadline, new inflation data, and earnings from major tech companies.
Ahead of Friday’s tariff deadline involving a number of significant U.S. trading partners, investors will be keeping an eye out for further trade agreements.
Updates on U.S. employment and inflation levels that are due this week may also hint at the possibility of rate decreases at upcoming Fed meetings, even though the Fed is not anticipated to change interest rates on Wednesday.
This week will see the release of several significant company earnings reports, including those from Amazon, Apple, Microsoft, and Meta Platforms. This week’s schedule also includes important cryptocurrency, health care, and finance companies.
President Donald Trump’s tariff deadline of August 1 draws near. Ahead of an Aug. 12 deadline that is probably going to be extended, U.S. officials will also be negotiating with China.
Ahead of the Federal Reserve’s upcoming interest-rate announcement on Wednesday, Trump continues to force Powell to cut rates. However, markets expect that the central bank would maintain interest rates at their current levels.
Whether inflation in June remained over the Fed’s objective will be revealed on Thursday by the personal consumption expenditures index. The Fed has stated that a robust job market is a major reason for maintaining high interest rates, and on Friday the latest employment data will be made public.
Market watchers will get a first look at gross domestic product for the second quarter after the economy contracted slightly in the first three months of the year.
Earnings This Week
This week’s results calendar includes more than half of the “Magnificent Seven,” along with important businesses from the banking, automotive, health care, and cryptocurrency industries.
On Wednesday, Meta Platforms (META) is scheduled to report. The parent company of Facebook has stated that it intends to increase its investment in the development of artificial intelligence.
Analyst optimism on Microsoft’s (MSFT) AI potential coincides with the company’s anticipated earnings announcement that same day. Analysts are keeping an eye on Apple’s (AAPL) Thursday update to see if the iPhone manufacturer is catching up to its competitors in the field of artificial intelligence. Amazon’s (AMZN) anticipated report comes after its July Prime Day event.
Earnings from Visa (V) and Mastercard (MA) may reveal patterns in consumer spending. Additionally, reports from Starbucks (SBUX), Colgate-Palmolive (CL), and Procter & Gamble (PG) may offer more comprehensive economic information.