U.S. Stocks Tick Up on Strong Retail Sales and Earnings; Netflix Results Awaited
U.S. equities edged higher Thursday as investors digested a fresh wave of corporate earnings alongside better-than-expected economic indicators.
By 09:35 ET (13:35 GMT), the Dow Jones Industrial Average had gained 100 points (0.2%), while the S&P 500 and NASDAQ Composite both rose 0.1%, supported by positive momentum from corporate results and retail data.
Netflix Earnings in Focus
A broadly upbeat start to the earnings season continued to support market sentiment, particularly after several major banks reported results that exceeded expectations—despite offering cautious guidance for the quarters ahead.
Investors are now turning their attention to Netflix (NASDAQ:NFLX), which is set to release its second-quarter results after market close. Analysts at Vital Knowledge expect strong numbers, citing Netflix’s growing dominance in the streaming space, though they also cautioned that short-term expectations may be overly optimistic.
Earnings Highlights
- PepsiCo (NASDAQ:PEP) gained after beating Q2 profit forecasts, with strong international performance helping it overcome a difficult business environment.
- GE Aerospace (NYSE:GE) climbed after topping earnings estimates and boosting its full-year guidance, citing strong commercial services and efficiency gains.
- United Airlines (NASDAQ:UAL) slipped as the airline warned of lower earnings this quarter due to disruptions at Newark airport, a major hub.
- Lucid Group (NASDAQ:LCID) surged 35% after unveiling a new partnership with Uber (NYSE:UBER) and Nuro to develop a next-gen autonomous robotaxi system.
- Taiwan Semiconductor Manufacturing (NYSE:TSM) reported record Q2 profits, fueled by booming demand for AI chips.
Trump Walks Back Powell Firing Rumors
Markets experienced significant volatility Wednesday following reports that President Donald Trump was considering firing Federal Reserve Chair Jerome Powell. Trump later denied the reports but added that he “would love” for Powell to step down. Powell, who was appointed by Trump in 2017, has said he intends to serve out his term through May 2026.
Trump has frequently criticized Powell for not cutting interest rates, while Powell has advocated for a cautious approach, largely due to economic uncertainty stemming from Trump’s own tariff policies.
Retail Sales Rebound in June
Retail sales climbed 0.6% in June, reversing a 0.9% decline in May, according to the U.S. Commerce Department. The figure handily beat expectations for a 0.1% rise, indicating resilient consumer spending, even though the data is not adjusted for inflation.
Additional economic updates included:
- The Philadelphia Fed Manufacturing Index returned to positive territory, signaling strength in the regional industrial economy.
- Initial jobless claims declined slightly to 221,000, reinforcing signs of labor market stability.
At its June meeting, the Federal Reserve projected two interest rate cuts before year-end. However, New York Fed President John Williams struck a more cautious tone this week, saying it was too soon to consider easing due to inflation risks driven by tariffs.
Trade Developments: India Deal Near
President Trump said a trade agreement with India is close to being finalized, following a recently signed deal with Indonesia. Talks with the European Union are ongoing, though tensions remain high over the U.S.’s proposed 30% tariff. The EU has warned it may retaliate if the tariff goes into effect.
Trump has reiterated he will not extend the August 1 deadline tied to these new trade measures.
Oil Prices Stabilize After Three-Day Decline
Crude prices steadied Thursday, supported by stronger economic data from top oil consumers.
At 09:35 ET:
- Brent crude edged down 0.1% to $68.57 per barrel
- WTI crude rose 0.4% to $66.61 per barrel
Recent upbeat growth data from China, the world’s largest crude importer, improved market sentiment. Additionally, the U.S. Energy Information Administration (EIA) reported a sharper-than-expected drop in crude inventories—down 3.9 million barrels to 422.2 million—pointing to increased refinery activity and tighter supply.
