Stocks enjoyed a stellar week, thanks to easing Middle East tensions and a trade deal between the U.S. and China. Economic data also impressed, with the S&P global flash U.S. manufacturing purchasing managers' index (PMI) and the S&P flash U.S. services PMI both coming in above estimates. A Israel-Iran ceasefire alleviated war concerns, though Federal Reserve Chair Jerome Powell reiterated the central bank's "wait-and-see" approach toward tariffs and inflation, with no interest rate cuts on the horizon.
The White House also downplayed the July 8-9 tariff deadlines, adding they were "not critical," as Commerce Secretary Howard Lutnick noted 10 key trading partners should also finalize deals in the coming weeks. Both the S&P 500 Index (SPX) and Nasdaq Composite (IXIC) surged to record highs on Friday, while the Dow Jones Industrial Average (DJI) consolidated above the 20,000 level. For the week, all the major benchmarks were pacing for healthy weekly gains.
Tech Sector Breakdown
Chip stocks were back in focus this week, with strong earnings from Micron Technology (MU) driving shares to a record peak, and Super Micro Computer (SMCI) capturing the attention of options bulls. Across the broader tech sector, AppLovin (APP) stock signaled a rebound, while shares of Blackberry (BB) surged following its upbeat quarterly report. Trade Desk (TTD) and QuantumScape (QS) shares rallied as well -- the latter enjoying tailwinds from its program integration -- while CoreWeave (CRWV) pulled back from all-time highs.
What Brokerages Think
Analysts didn't miss their chance to chime in this week, with DoorDash (DASH) shares surging after more praise. JPMorgan initiated coverage of the gaming sector, calling Caesars Entertainment (CZR) shares "overweight," while naming PENN Entertainment (PENN) one of its top picks. That wasn't all for PENN, with an upgrade from Citizens to "outperform" providing additional tailwinds. Meanwhile, Goldman Sachs downgraded Dollar General (DG) stock to "neutral."
Holiday-Shortened Week Still Bringing Fireworks
A new month kicks off next week, with markets closed Friday, July 4 for Independence Day. Despite the holiday, the ADP employment report will still be due out, in addition to manufacturing data and the S&P final services purchasing managers' index (PMI). The earnings docket will be quiet, with with just Constellation Brands (STX) slated to report. Our Senior Quantitate Analyst Rocky White dug into the best and worst stocks to own next week, while Senior Market Strategist Matthew Timpane just dug into risk appetite.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
