Editor's PiCK
S&P500 and Nasdaq Renew Record Highs for Consecutive Days... 'Earnings Shock' Tesla Down 8% [New York Stock Market Briefing]
Summary
- It was reported that the Nasdaq and S&P500 indices have renewed their record highs every day, bolstered by Alphabet's strong earnings.
- Tesla reportedly saw its stock price plunge by 8% following an announcement of a weak second-quarter performance.
- It was reported that the U.S. manufacturing PMI for July fell to its lowest in seven months, signaling economic contraction.
The Nasdaq and S&P500 indices have reached record highs for consecutive days. Alphabet's strong earnings have contributed to improved investor sentiment. However, Tesla, which announced disappointing results for the second quarter, plunged by 8%.
On the 24th (local time), in the New York Stock Market, the S&P500 index closed at 6,363.35, up by 4.44 points (0.07%) from the previous session, while the tech-heavy Nasdaq Composite ended at 21,057.96, up by 37.94 points (0.18%) from the previous session. The Dow Jones Industrial Average finished at 44,693.91, down by 316.38 points (0.7%).
Since surpassing the 6,300 level for the first time in history on the 21st, the S&P500 has continued climbing, repeatedly breaking its own record highs. Nasdaq also achieved further gains after breaking through the 21,000 level for the first time the previous day. The Dow index fell due to steep declines in IBM, UnitedHealth Group, and Honeywell International.
Google's parent company Alphabet (0.88%) reported strong earnings, fueling strength in tech stocks. In the second quarter, Alphabet's revenue and earnings per share (EPS) increased by 14% and 22% year-over-year, respectively, recording $96.428 billion and $2.31. Both figures surpassed market expectations. On the back of Alphabet's strong performance, semiconductor stocks such as NVIDIA (1.73%), Broadcom (1.77%), Micron (1.73%), and AMD (2.19%) also climbed in succession.
Ross Mayfield, a strategist at Baird, an American investment bank, evaluated, "Considering the scale and influence of big tech and artificial intelligence (AI), Alphabet's results gave a good resonance to a market that constantly questions whether AI investments will indeed yield solid (returns) and whether these trends can persist."
Trade negotiations are progressing smoothly as well. After Japan, news came out that an agreement with the European Union (EU) is imminent. The British daily Financial Times (FT) reported that the EU is close to signing a deal with Japan that would apply a 15% mutual tariff rate, similar to the agreement with Japan.
Tesla plummeted by 8.2% in just one day due to weak earnings. Second-quarter revenue was $22.496 billion, a 12% decrease compared to the same period last year. Operating profit dropped by 42% to $923 million. Elon Musk, CEO of Tesla, stated on a conference call, "We are now in a transitional period where we are losing many incentives," and added, "We may go through several difficult quarters."
The preliminary U.S. Manufacturing Purchasing Managers' Index (PMI) for July was recorded at 49.5, down 3.4 points from 52.9 the previous month. This is the lowest in seven months. Manufacturing conditions entered a contractionary phase for the first time since December 2024.
According to the Chicago Mercantile Exchange (CME) FedWatch Tool, the federal funds rate futures market reflected a 60.4% probability of a 25bp (1bp=0.01% point) rate cut by September, unchanged from the previous day's close.
Byounggi Jin, Hankyung.com reporter young71@hankyung.com
Korea Economic Daily
hankyung@bloomingbit.ioThe Korea Economic Daily Global is a digital media where latest news on Korean companies, industries, and financial markets.
