July 22nd, 2025
Markets Open Flat as Investors Await Direction
U.S. and Canadian equity markets opened broadly unchanged this morning, with investors appearing to wait for a catalyst to drive the next move. This follows a mixed overnight session in global markets: Emerging Markets posted gains, while Japanese stocks fell and Eurozone indexes struggled to find momentum.
The Nasdaq Composite (^IXIC) dropped 0.4% ahead of the first Big Tech quarterly results, and the S&P 500 (^GSPC) fell 0.1%. Meanwhile, the Dow Jones Industrial Average (^DJI) climbed around 0.1%.
Economic Takeaways:
- The U.S. 10-year Treasury yield at 4.36%, right in line with its three-month average.
- The U.S. dollar is holding firm against a trade-weighted basket of currencies.
- Oil prices have dipped 1%, remaining within their recent $65–$70 range.
- Treasury Secretary Bessant stated that the U.S. is in no rush to finalize trade deals before the self-imposed August 1 deadline.
- President Trump is hosting his Philippine counterpart at the White House today for trade discussions. A South Korean delegation is scheduled for high-level talks on Friday, and Bessant will meet with Chinese officials in Stockholm next week.
- The central bank’s next policy meeting is set for next week, and the FOMC appears divided on the appropriate direction for interest rates.
- President Trump asked the Supreme Court to reject a challenge to his tariffs in a case filed by two educational-toy makers, Bloomberg reported.
- Jerome Powell’s speech Tuesday morning is also in high focus as the Federal Reserve chair comes under pressure from Trump to step down. Powell delivered opening remarks at a banking conference, though Fed-related commentary remains light this week with just eight days until the Federal Open Market Committee (FOMC) meeting.
- On the policy front, chances of a Fed rate cut next week were below 5% early Tuesday, per the CME FedWatch Tool. Odds of at least one rate cut by September stood near 57%, though September probabilities have declined this week.
Wall Street Turns More Bullish on Amazon Ahead of Q2 Earnings
Analysts are raising their price targets on Amazon (AMZN) ahead of the company’s upcoming second-quarter earnings report on July 31.
Needham’s Laura Martin increased her target to $265 from $220, citing a combination of strong revenue growth from Amazon Web Services (AWS), record-setting Prime Day performance, easing tariff pressures, and reduced logistics costs driven by generative AI.
“AMZN is reporting strong improvement in its labor productivity, which we believe is a lead indicator to upside share price performance,” Martin noted.
Deutsche Bank’s Lee Horowitz also raised his price target on Amazon shares, moving it to $266 from $230. He pointed to continued consumer spending and fading tariff concerns as positive signs for e-commerce. Horowitz also highlighted “healthy” advertising revenue and “AI tailwinds” boosting AWS as additional reasons for optimism heading into the earnings release.
Bessent Urges Internal Fed Review but Says Powell Need Not Resign
Treasury Secretary Scott Bessent is calling for increased scrutiny of the Federal Reserve’s operations, while stopping short of joining calls for Chair Jerome Powell’s immediate resignation—a demand President Trump has made repeatedly.
“There’s nothing that tells me that he should step down right now,” Bessent said in an interview with Fox Business on Tuesday. “His term ends in May. If he wants to see that through, I think he should. If he wants to leave early, I think he should.”
Despite defending Powell’s right to stay on, Bessent intensified pressure on the central bank with a post on X Monday, calling for a formal review of the Fed’s $2.5 billion headquarters renovation and a broader examination of its non-monetary policy activities.
He warned that “significant mission creep and institutional growth have taken the Fed into areas that potentially jeopardize the independence of its core monetary policy mission.”
On the Move
- General Motors (GM) beat earnings-per-share estimates despite a year-over-year decline, citing a $1.1 billion impact from tariffs. The company reported that its core profit sank over 32% in the second quarter as tariff headwinds sapped $1.1 billion from its results.
- PulteGroup (PHM) and D.R. Horton (DHI) rallied sharply Tuesday afternoon following better-than-expected earnings reports.
- Philip Morris (PM) fell 6%, as slipping cigarette sales and underwhelming Zyn deliveries failed to meet investor expectations.
- Northrop Grumman (NOC) gained 8% after the company raised its full-year guidance, while RTX Corporation (RTX) dipped 1.7% following a downward revision to its 2025 forecast.
- Coca-Cola (KO) traded slightly lower, down less than 1% on the day.
- Google (GOOG) shares edged slightly higher, while Tesla (TSLA) rose about 1% as investors looked ahead to their highly anticipated earnings reports set for Wednesday.
- Coinbase (COIN), the largest U.S. cryptocurrency exchange, and Pittsburgh-based regional bank PNC announced a strategic partnership on Tuesday.
- Kohl’s (KSS) stock jumped nearly 30% Tuesday morning, with trading briefly halted after shares jumped as much as 105% earlier in the session.
- Circle (CRCL) shares fell more than 7% Tuesday morning, extending its 3.4% drop the day prior.
- The Magnificent Seven are up 27% over the last three months, versus just an 11% gain for remaining S&P 500 stocks over that period, Barron’s
- Apple (AAPL) edged higher early Tuesday, building on Monday’s rally to two-week highs after Bloomberg reported plans for a foldable phone release next year. Despite the boost, shares remain down about 15% year to date.
- Lockheed Martin shares plunged 8.8% following earnings that missed analysts’ consensus, with quarterly revenue also falling short of expectations. Heavy losses from a classified program within its Aeronautics segment contributed to the disappointing results. The company lowered its fiscal 2025 guidance, now projecting earnings well below the FactSet consensus.
- R. Horton (DHI) jumped 7.7% early Tuesday after fiscal Q3 results surpassed Wall Street’s estimates. However, the homebuilder lowered the upper end of its revenue forecast, noting ongoing pressure from affordability constraints and cautious buyer behavior. Revenue declined year-over-year, and homes closed fell 4.1%.
- NXP Semiconductors (NXPI) dropped more than 6% as investors reacted to Q3 guidance projecting lower earnings per share versus last year. While earnings beat estimates and revenue matched consensus, the outlook disappointed.
- CoreWeave (CRWV) added 0.5% after Monday’s strong rally, buoyed by a $1.5 billion bond offering announced by the AI cloud computing company.
- Opendoor (OPEN) soared 21.5% in pre-market action and is up 300% since July 11. Barron’s described the stock as “a classic example of a meme stock.”
- Texas Instruments (TXN) fell 1.4% ahead of its earnings report after the close. The chipmaker’s results are seen as a key indicator for demand across smartphones, medical devices, and automobiles. Investors also await updates on plans to build or expand seven U.S. semiconductor facilities.
What’s Ahead
Tesla (TSLA) is set to release its second-quarter earnings after Wednesday’s market close. The electric vehicle maker has faced a challenging period recently, partly due to increasing concerns over CEO Elon Musk’s extracurricular pursuits—most notably his plan to launch a new political party.
“Tesla is heading into one of the most important stages of its growth cycle with the autonomous and robotics future now on the doorstep and cannot have Musk spending more and more time creating a political party which will require countless time, energy, and political capital,” said Wedbush analyst Dan Ives, who rates the stock as Outperform.
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