Everything to Know about Macro and Markets
Stocks rebounded on Friday, closing the week firmly in the green – the market’s third winning week out of the last four. The S&P 500 (SPX) rallied for its strongest week since late June, closing on the brink of a record after gaining 2.43%. The Dow Jones Industrial Average (DJIA) finished the week up 1.35%. Meanwhile, the Nasdaq-100 (NDX) surged by 3.73%, reaching a new record.
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The Land of the Buoyant
Technology and Consumer Discretionary sectors led the charge, while healthcare lagged amid tariff and clinical-trial headwinds. Tech stocks pulled major investor inflows, especially into semiconductor and AI-related names.
After the prior week’s pull‑back, investors bought the dip again, demonstrating conviction in the rally’s viability – grounded in solid fundamentals. Around 90% of S&P 500 companies have reported Q2 earnings, with 81% beating expectations – the best since Q3 2023. In tech, more than 90% have exceeded forecasts. These strong results have prompted analysts to lift Q3 earnings expectations, particularly for Energy, Communication Services, Technology, and Financials.
Despite ongoing tariff-related and broader macro uncertainties, the U.S. corporate sector remains resilient – with expectations that this strength will persist, assuming the economy holds. Companies’ managements and boards are reflecting that confidence through share repurchases. In July alone, U.S. companies announced a record $166 billion in stock buybacks – the highest for any July on record, and year-to-date repurchases now total nearly $926 billion, exceeding the previous record.
Additionally, IPO activity is robust – as of August 5, 2025, there have been 202 IPOs in the U.S., up 80% over the same period last year. This resurgence is widely seen as driven by growth and profitability – quite distinct from the speculative SPAC wave in 2021.
The divergence between Wall Street and Main Street sentiment is narrowing – both appear to be looking past the dire headlines on tariffs, economic, and geopolitical risks. New business creation in the U.S. has surged since November, with July business applications hitting their highest levels since late 2007.
…and the Resilient
President Donald Trump claimed tariffs were “having a huge positive impact on the stock market,” adding that “hundreds of billions of dollars are pouring into our country’s coffers,” supporting the economy and equities. Whether tariffs deserve credit is debatable – but the fear factor seems much less than expected.
The average effective U.S. tariff rate is at its highest level since the Great Depression – yet today’s economy and corporate sector are far more advanced and adaptive. Tariffs have already nudged prices upward, and a short-term inflation bump is expected throughout this year and next.
Still, the U.S. economy – dynamic and resilient – is adjusting. Companies are shifting supply chains, and because tariffs were announced ahead of time, they had ample time to prepare. Some sectors may even benefit from increased domestic investment and reshoring. On the household front, while tariffs could dent purchasing power via higher prices, the impact should be limited and temporary, not a sustained driver of inflation. Future trade agreements are expected to ease tensions and help contain inflation and growth risks.
Last week’s rally underscores U.S. resilience – stocks advanced even as Trump’s tariff rollout accelerated. In fact, some signs of economic softness may have aided the rally, by heightening odds of a 0.25% rate cut in September.
With valuations rich but still not technically overbought, a rate cut could inject fresh momentum heading into the Q3 earnings season. Nevertheless, analysts broadly agree that the path ahead may remain choppy, with trade, macro, and geopolitical developments likely to test investor resolve.
Stocks That Made the News
▣ Stocks heavily exposed to higher tariffs – including Lululemon (LULU), Nike (NKE), Caterpillar (CAT) – ended the week deep in the red as tariffs took effect. Caterpillar (CAT) warned of up to $1.5 billion in tariff-related costs for the year, with $400-500 million expected in Q3 alone, and its shares slipped on profit-miss news. Caterpillar’s tariff exposure made it one of the week’s weakest performers in industrials. Meanwhile, several stocks – including Kroger (KR), Monster Beverage (MNST), Cummins (CMI), Fastenal (FAST), Bank of New York Mellon (BK) – closed at all-time highs.
▣ The newly proposed 100% tariffs on semiconductors didn’t become a drag, as exemptions were broader than expected and included firms with U.S. production. Apple (AAPL) had its best week since 2020 amid optimism that its plan to spend about $600 billion over four years on U.S. manufacturing would help it avoid tariffs.
▣ Taiwan Semiconductor Manufacturing (TSM) reported a ~26% YoY revenue surge in July, driven by accelerating AI demand. In response, it raised its 2025 U.S.-dollar sales growth forecast to around 30%. TSMC was exempted from the proposed 100% U.S. tariff due to its extensive U.S. investments, including a $165 billion commitment for plants in Arizona.
▣ Tesla (TSLA) investors cheered the dismantling of its Dojo supercomputer team, sending the stock nearly 7% higher for the week as the company shifted focus to upcoming AI5 and AI6 chip architectures and leaned on external compute partners like Nvidia (NVDA) and AMD (AMD).
▣ Palantir Technologies (PLTR) surged almost 17% for the week, taking its year-to-date gain to 147% and hitting a new record after the earnings report appeared to meet the Street’s elevated expectations for Q2.
▣ The Healthcare sector saw mixed action. Gilead Sciences (GILD) climbed over 5% following strong Q2 results and raised 2025 sales and EPS guidance, buoyed by a promising new HIV-prevention drug launch. Meanwhile, Eli Lilly (LLY) suffered its worst day in 25 years, tumbling over 18% for the week as obesity-pill trial data disappointed investors despite solid earnings and guidance.
▣ The Trade Desk (TTD) was the S&P 500’s worst performer, plunging over 38% following its earnings report. Despite strong results, the stock was slammed with downgrades after CEO Jeff Green warned of tariff and inflation pressures. This marks its second 30%-plus drop on earnings this year, following a 33% plunge in February.
Upcoming Earnings and Dividend Announcements
The Q2 2025 earnings season is winding down, but several notable releases are still scheduled for this week. These include: AST SpaceMobile (ASTS), Oklo (OKLO), Monday.com (MNDY), CoreWeave (CRWV), Cisco Systems (CSCO), Applied Materials (AMAT), Deere (DE), and Ross Stores (ROST).
Ex-dividend dates are coming this week for Ford Motor (F), Reinsurance Group (RGA), Target (TGT), Clorox (CLX), Kenvue (KVUE), Viper Energy (VNOM), Coterra Energy (CTRA), Exxon Mobil (XOM), and other dividend-paying firms.
For additional exclusive market insights and content from TipRanks Macro & Markets research analyst Yulia Vaiman, click here.