Stocks supported by chip stock strength and low bond yield

S&P 500 Index ($spx) (SPY) closed at +0.14% on Monday, with Dow Jones Industrial Index ($dowi) (DIA) falling -0.04%, while NASDAQ 100 Index ($IUXX) (QQQ) rising 0.50%. E-Mini S&P Futures (ESU25) rose +0.19% in September, and E-Mini Nasdaq Futures (NQU25) rose +0.54% in September.

The stock index settled high mainly on Monday, with the S&P 500 and Nasdaq 100 posting the highest ever highs. The stock found support as its 10-year T-note yield fell by -5 bp to a weekly low of 4.37%. Also, the strength of chip stock on Monday boosted technology stocks and increased the broader market. On the negative side, natural gas producers retreated on Monday at a weekly low, with Nat-Gas futures falling by more than -6%.

Several lucrative corporate news supported the stock’s profits on Monday. The block rose more than +7% after S&P Dow Jones Indices announced it would replace Hess Corp with the S&P 500 before trading began Wednesday. Verizon Communications also rose more than +4% after lifting its bottom edge of full-year revenue forecast.

Recent trade news has put some downward pressure on stocks. Last Wednesday, President Trump announced he would send tariff letters to more than 150 countries, notifying him that the tariff rate could be 10% or 15%, which could be on August 1. President Trump also recently announced that 30% tariffs from the US will be imposed on the European Union and Mexico.

This week’s market will focus on tariff news along with the announcement of new trade deals. On Wednesday June, existing home sales are expected to reach 4.00 million from -0.7%m/m. On Thursday, the weekly initial unemployment claims are expected to rise from +6,000 to 227,000. Additionally, S&P US manufacturing PMI is expected to slip from -0.4 to 52.5 in July. Finally, on Thursday June, new home sales are expected to rise from +4.3%m/m to 650,000. New orders for capital goods are expected to increase +0.2% m/m on Friday in June with airless aircraft and parts.

Futures prices for federal funds are discounting the possibility of a -25 bp rate reduction at 3% at the FOMC meeting on July 29-30 and at 58% at the next September 16-17 meeting.

The market is eagerly awaiting this week’s quarterly corporate revenue results, including Wednesday’s Alphabet and Tesla. Approximately a fifth of S&P 500 companies are planning to report their second quarter revenue results this week. According to Bloomberg Intelligence, the S&P 500’s revenues show that second quarter revenues are better than expected at +2.8%Y/Y. Also, a survey by Yadeni shows that only six of the 11 S&P 500 sectors are forecasting the lowest revenue growth since the first quarter of 2023.

The overseas stock markets were mixed on Monday. The Euro Stoxx 50 has closed -0.30%. China’s Shanghai composites have been promoted to 9.5 months high and closed +0.72%. Japanese Nikkei Stock 225 was closed today due to Marine Corps holidays.

interest rate

Monday’s September 10 T-Notes (Znu25) closed out a +13 tick. T-note yields over the decade fell by 4.372% from -4.4 bp. SEP T-Notes rose to a one-week high on Monday, with 10-year T-Note yields falling to a one-week low of 4.350%. T-Notes met on Monday with carryover support from last Friday, when Fed Gov. Christopher Waller said he was in support of Fed rate cuts at the FOMC meeting on July 29-30. T-Notes also offers carryover support from Monday’s rally on German embankments in 2010 to two-week highs.

European government bond yields fell on Monday. Germany’s chest yield for the decade fell to a two-week low of 2.611%, down from -8.2 bp to 2.613%. The yield on gold leaf in the UK over the decade fell by 4.603% from -7.1 bp.

The swap is discounting the 2% chance if the -25 bp rate is reduced by the ECB at its policy meeting on Thursday.

US Stockmover

The strength of chipstock on Monday supported profits in the broader market. ARM Holdings Plc (ARM) closed more than +3% to lead the winners on the Nasdaq 100. Additionally, Qualcomm (QCOM) exceeded +2%. Additionally, NXP Semiconductors NV (NXPI), Broadcom (AVGO), LAM Research (LRCX), and Applied Materials (AMAT) exceeded +1%.

Block (XYZ) closed more than +7% after S&P Dow Jones Indices announced it would replace the S&P 500 Hess Corp before it began trading on Wednesday.

Verizon Communications (VZ) closed more than +4% to lead the S&P 500 and Dow Jones Industrial acquirers, increasing the lower limit of full year revenue from 1% to 3% from previous estimates, from 0% to +3%.

Pinterest (PINS) closed more than +2% after Morgan Stanley upgraded its share price to overweight with a price target of $45.

Dollar Tree (DLTR) closed more than +2% after Barclays upgraded its shares from equal weights with a price target of $120.

Equinix Inc. (EQIX) closed more than +1% after Elliot Investment Management said it had built up its shares in the company to take steps to raise the stock price.

Investco Ltd (IVZ) closed more than +1% after TD Cowen upgraded its shares to buy from Hold with a price target of $25.

Natural gas producers retreated on Monday after Nat-Gas Futures (NQQ25) plunged more than -6% to a weekly low. As a result, EQT Corp (EQT) closed above -9% to lead the losers in the S&P 500. Also, Antero Resources (AR) was closed at over -10%, Energy (EXE) was closed at over -8%, Cheniere Energy (LNG) was closed at over -7%, and CTERRA Energy (CTRA) was closed at over -5%.

Sarepta Therapeutics (SRPT) closed more than -5% after refusing to suspend all shipments of Elevedi treatment after three deaths were associated with company gene therapy.

Molina Healthcare (MOH) closed more than -3% after TD Cowen reduced its stock price target from $369 to $283.

American Express (AXP) closed more than -1% to lead the Dow Jones Industrial losers after issuing $4 billion in debt securities over four and seven years.

Biogen (BIIB) closed more than -1% after Truist Securities downgraded its shares to hold from purchases.

Centene (CNC) closed more than -1% after TD Cowen downgraded its shares and held it from purchases.

Revenue Report (7/22/2025)

Avery Dennison Corporation (AVY), Baker Hughes Corp (BKR), Capital One Financial Corp (COF), Chubb Ltd (CB), Coca-Cola Co/The (KO), Costar Group Inc (CSGP), Danaher Corp (DHR), Dr Horton Inc (DHI), Enphase Energy Inc (ENPH) (EFX), General Motors Co (GM), Genuine Parts Co (GPC), Halliburton Co (HAL), COS INC/THE (IPG), Intuitive Surgical Inc (ISRG), INVESCO LTD (IVZ), IQVIA Holdings Inc (IQV), KeyCORP (Keycin Inci (lmci), Lockheed Martin Martin Martin Martin Northrop Grumman Corp (NOC), PACCAR INC (PCAR), Pentair PLC (PNR), Philip Morris International in (PM), Pultegroup Inc (PHM), Quest Diagnostics Inc (DGX), RTX Corp (RTX), Sherwin-Williams Co/the (SHW), Synchrony Financive (TEXAS)

On the date of publication, Rich Asplund had no position (directly or indirectly) in any of the securities mentioned in this article. All information and data in this article is for informational purposes only. This article was originally published barchart.com