S&P 500 Rises to Record as Treasury Went Well – US Market Wrap

Wall Street was relatively tranquil, with equities climbing as traders analysed a series of company outlooks. Treasuries recovered from session lows after a $22 billion auction of 30-year notes demonstrated demand for longer-term debt, amid concerns about the US deficit and tariff effects.

Just a few days before the unofficial start of the earnings season, which will include data from major banks, Delta Air Lines’ bullish prediction boosted the industry. The S&P 500 reached all-time highs. Tesla jumped on plans to expand its Robotaxi service into California and Arizona. Nvidia’s worth surpassed $4 trillion. Huang, the chipmaker’s CEO, is alleged to have met with Trump before to his scheduled trip to China.

Treasury 10-year yields increased one basis point to 4.34%, while 30-year yields remained unchanged at 4.86%. The debt auction on Thursday was awarded at 4.889%, compared to a 4.890% when-issued yield at the bidding deadline of 1 p.m. New York time. A reduction in unemployment claims during the Independence Day vacation was accepted in stride. The dollar fluctuated.

The Fed’s Musalem sees positive risks to inflation, but it’s too early to say if tariffs will have a long-term impact on pricing. His San Francisco colleague, Daly, said she still sees two rate cuts this year as likely and believes the price consequences of tariffs would be more modest than expected.

Policymakers have kept borrowing costs stable this year, although there is disagreement among officials about how many rate decreases they foresee in 2025. Fed policymakers will meet next July 29-30. Based on futures contracts, traders expect the central bank to cut interest rates twice this year.

Wall Street expects little from S&P 500 firms this earnings season, anticipating only 2% growth and a margin decline in the second quarter. In July, US equities saw a notable shift: some of the largest laggards from the first half are now thriving, while the year’s early winners are losing favour.

JPMorgan CEO Dimon advised markets not to be complacent about tariffs while speaking in Dublin. He also stated that it is critical that the European Union and the United States reach a deal, adding that a tariff framework “has to be done.”

“There’s zero chance we’ll have tariff clarity by August 1st, so a July rate cut is inconceivable,” said Tom Essaye of The Sevens Report. “The practical implication of this regularly delayed tariff strategy is to diminish the prospects of a September rate cut, potentially leaving rates higher for longer and increasing the likelihood of an economic slowdown.

“More tariff clarity should emerge as trade talks progress,” said Mark Haefele of UBS. “Historically, declines in policy uncertainty have been favourable for markets, and we believe US trade policy will become more stable in the second half of the year.”