Wall Street opened higher on Monday, with all major stock indices in the green, as the Dow Jones Industrial Average edged up 85 points amid investor focus on big-cap earnings.
The Dow Jones Industrial Average added 85 points, and the benchmark stock index, the S&P 500, gained 0.23% as stocks opened higher. The tech-heavy Nasdaq also climbed, adding 0.37% in early market activity.
Dow’s move on Monday suggests that traders are slightly bullish after a seesaw week, during which the blue-chip benchmark battled some downside pressure.
Elsewhere in the market, oil prices remain steady despite geopolitical tensions that are raising concerns about supply. In cryptocurrency, Bitcoin (BTC) hovered around $118,000, with the benchmark digital asset back above the level after recent declines from its peak of over $123,000.
Investor sentiment and tariffs
As the new week begins, all eyes are on the earnings and outlook of Wall Street’s mega caps. The gains in early session trading however suggests tariffs remain a key factor, despite equities notching record highs in the months since the dip that followed President Donald Trump’s “Liberation Day” tariffs onslaught.
Notably, U.S. stocks edged higher last week, buoyed by earnings reports by top banks and leading chipmakers, with both the S&P 500 and Nasdaq hitting record highs.
Traders may eye an overall positive week, but the market will be keen on developments around tariffs as Trump’s August 1 deadline looms.
CNBC reported on Monday that the U.S. is playing hardball on the Aug. 1 deadline, with the European Union battling to have a deal in place before then.
EU’s quest to strike a deal follows U.S. Commerce Secretary Howard Lutnick’s comments over the weekend that the U.S. is confident it will agree a trade deal with the EU. However, he maintained that the deadline for the 30% tariff on the block will not change.
Big earnings, including Alphabet, Tesla
In large parts, volatility may be injected by tech heavyweights’ earnings reports in the week. These will include a focus on the “Magnificent Seven”, with Alphabet (GOOG) and Tesla (TSLA) the first in line with reports expected on Wednesday, July 23.
As in previous markets, a strong earnings result from Big Tech companies will drive bullish sentiment, with notable interest including the artificial intelligence segment. Optimism is already elevated, as nearly 86% of the 59 S&P 500 companies have released their quarterly results, beating consensus estimates.
However, the issue of interest rates and the U.S. Federal Reserve’s stance is also crucial to investors.
Speaking to CNBC’s ‘Squawk Box’, Treasury Secretary Scott Bessent has once again criticized Fed Chair Jerome Powell. Bessent slammed Powell’s tenure and suggested that investigations might be necessary at the central bank.
The Trump administration frequently criticizes the central bank and Powell’s leadership for maintaining interest rates at their current level.
But current inflation data doesn’t support President Trump’s argument. Inflation spiked by 2.7% in June, as businesses passed the costs of Trump’s tariff hikes onto consumers.
