U.S. Weekly Review | Stock Market Keeps Hitting Highs Amid Tesla, Google, Trade Deals

The stock market continued to advance amid Trump trade deals and a slew of earnings. The S&P 500 and Nasdaq composite set fresh highs while the Dow Jones came close and the Russell 2000 hit a five-month high during the week. Tesla (TSLA) dived as Elon Musk warned of "a few rough quarters."

Google-parent Alphabet (GOOGL) rose on strong cloud-computing growth, while a stepped-up capital spending forecast lifted AI chip and hardware plays. ServiceNow (NOW) and Boston Scientific (BSX) popped while GE Vernova (GEV) surged.

Stock Market Rally

A Trump trade deal with Japan and hopes for a similar accord with Europe helped buoy optimism. Growth stocks suffered sharp losses Tuesday morning, but quickly bounced back. Alphabet (GOOGL) rose on earnings while Tesla (TSLA) dived, but the former had a bigger impact.

Tesla Dives On 'Rough' Outlook

The EV giant reported a 23% EPS decline, in line with views, while revenue declined 12% to $22.496 billion, slightly beating. CEO Elon Musk said that Tesla (TSLA) "could have a few rough quarters" after the $7,500 tax credit ends Sept. 30. Musk also confirmed that the "new affordable" vehicle will look just like a Model Y, with "volume" output later this year. He remained bullish on self-driving, but Tesla appeared to confirm pushed-back production timelines for the Optimus robot. Shares plunged below key levels Thursday. Tesla reportedly could expand its robotaxi service to San Francisco soon, but with human safety drivers behind the wheel instead of monitors in the passenger seat.

Google Beats On Cloud, Ad Gains

Google-parent Alphabet (GOOGL) said Q2 earnings rose 22% to $2.31 per share, while gross revenue rose 14% to $96.43 billion, both beating. Internet search-advertising revenue came in at $54.19 billion versus estimates of $52.915 billion. Meanwhile, YouTube ad revenue was $9.79 billion, beating estimates of $9.58 billion. Cloud-computing revenue jumped 32% to $13.62 billion. Google expects capital spending to reach $85 billion in 2025, up from earlier guidance of $75 billion, lifting AI chipmakers. GOOGL shares rose last week.

SAP, ServiceNow Beat

Enterprise software maker ServiceNow (NOW) said Q2 earnings rose 31% to $4.09 per share, easily beating. Revenue climbed 22.5% to $3.215 billion, with subscription revenue up 22.5% to $3.11 billion, both slightly topping estimates. Current remaining performance obligations, or CRPO, rose 24% to $10.92 billion. CRPO bookings are an aggregate of deferred revenue and order backlog and serve as a sales growth metric. ServiceNow guided slightly higher for Q3 subscription revenue. Shares initially jumped but pared gains. SAP (SAP) said Q2 EPS rose 36% to 1.50 euros per share (about $1.76) on an adjusted basis. Revenue climbed 9% to 9.027 billion euros ($10.57 billion). Both beat. Cloud computing revenue rose 28% to 5.13 billion euros, but that just missed views. Current cloud backlog growth slightly slowed. SAP fell solidly.

GE Vernova Soars On 'Investment Supercycle'

Earnings fell 6% per share but beat views. Revenue, which climbed 11% to $9.1 billion, also beat views. GE Vernova (GEV) CEO Scott Strazik said the industry is at the beginning of an "investment supercycle" and that GE Vernova's long-term potential is "accelerating faster." The S&P 500 component guided higher. GEV stock jumped to a new high. Meanwhile, power producers generally rallied on a strong electricity price auction.

Homebuilder Earnings

Several homebuilders reported during the week, with divergent stock action. D.R. Horton (DHI) reported an 18% earnings decline for the fiscal third quarter while PulteGroup (PHM) saw second-quarter EPS fall 21%. NVR (NVR) booked a 10% EPS decline. D.R. Horton predicted hefty incentives will increase in the current quarter, but DHI stock jumped above its 200-day line, along with Pulte. NVR rose but hit resistance at that key level. Tri Pointe Homes (TPH) reported a 46% EPS tumble, and forecast home deliveries in Q3 will fall vs. Q2. Taylor Morrison (TMHC) saw Q2 EPS increase by 3%. Both builders tumbled, reversing lower for the week.

AI Cooling Plays Heat Up

Lennox International (LII) and Comfort Systems USA (FIX) surged on earnings, with the former breaking out past a handle entry while FIX stock simply vaulted to fresh highs. Lennox reported a 14% EPS gain, comfortably beating, while edging past sales views with a 3% rise to $1.5 billion. The HVAC play tied to AI data centers lifted its full-year earnings guidance to range from $23.25 to $24.25 per share. Comfort Systems delivered a 75% EPS gain, the third straight quarter of accelerating growth. Revenue climbed 20% to $2.17 billion.

Telecom Earnings

AT&T (T) reported adjusted Q2 EPS climbed 6% while revenue rose 3.5% to $30.8 billion and postpaid wireless phone customers grew 401,000, all beating. AT&T said it added 243,000 fiber internet customers in Q2, below FactSet's estimate of 252,000. In addition, AT&T reported Q2 free cash flow of $4.4 billion and raised its full-year free cash flow guidance.

Verizon Communications (VZ) reported Q2 earnings advanced 6% with revenue up 5% to $34.5 billion, both beating. The telecom company said it lost 9,000 wireless postpaid phone business and consumer subscribers, versus estimates for a gain of 13,000 subscribers. Verizon raised the low end of its full-year earnings guidance.

T-Mobile US (TMUS) said Q2 EPS rose 14% to $2.84, topping estimates, while a 7% revenue gain to $21.1 billion met views. The telecom added 830,000 postpaid phone subscribers, above consensus, and raised its full-year subscriber guidance. T-Mobile also announced a new wireless network leasing deal with Comcast (CMCSA) and Charter Communications (CHTR). The wireless firm is continuing its search for a new chief executive.

All three stocks rose solidly, clearing key levels.

Steel, Copper Giants Update Tariff Plans

Steelmaker Cleveland-Cliffs (CLF), Steel Dynamics (STLD) and copper giant Freeport-McMoRan (FCX) updated plans to capitalize on 50% Trump tariffs on steel, aluminum and copper amid their Q2 earnings reports. CLF said the tariffs have put a premium on U.S.-based steel-industry facilities. The company said it's in talks to sell noncore assets to foreign competitors but bigger deals are possible. STLD said it shipped its first aluminum flat-rolled products in June and will increasingly benefit from its investment in the new mill as it ramps up capacity over the next two years. FCX, the largest producer of copper in the U.S., is weighing a $3.5 billion investment in northwest Arizona to boost output by up to 250 million pounds a year. CLF surged 12.5% on earnings, breaking above its 200-day line. STLD slipped toward the lows of its recent flat-base consolidation. FCX has pulled back after jumping on July 8 tariff news, but has found support at its 21-day exponential average.

Defense Stocks Mixed

Lockheed Martin (LMT) dived on a big earnings miss, recording $1.6 billion in pretax losses on different programs. The defense giant cut its earnings forecast, but maintained its revenue and free cash flow outlooks. RTX (RTX) on Tuesday topped estimates and raised its full-year revenue outlook, but guided lower on EPS for the year. Shares initially tumbled but then rebounded to record highs. Northrop Grumman (NOC) and General Dynamics (GD) broke out to record highs after clearing expectations. L3Harris (LHX) and Textron (TXT) also rose on strong results. L3Harris CEO Christopher Kubasik said, "Defense is entering a generational investment cycle, as U.S. and allied budgets grow rapidly."

Two Medical Device Makers Jump

Boston Scientific (BSX) and Edwards Lifesciences (EW) surged on their reports and at least flirted with buy points, while robotic-surgery systems maker Intuitive Surgical (ISRG) tumbled. Boston Sci and Edwards are no longer at odds in the transcatheter aortic heart-valve replacements segment after Boston pulled its device from Europe following the failure of its U.S. study. Both companies beat views and guided higher. Intuitive Surgical also had a beat-and-raise report, but still sees slowing growth for procedures using its da Vinci systems.

Medpace Earnings 'Shockingly Strong'

Medpace (MEDP) and Iqvia (IQV) skyrocketed Tuesday with one analyst calling Medpace's earnings "shockingly strong." Both clinical resource organizations beat second-quarter forecasts with Medpace earning $3.10 a share, up 13%, on $603.3 million in sales. Sales climbed 14%. The beat came with a guidance boost, a surprise following recent funding cuts at the National Institutes of Health that could hurt biopharma efforts to run clinical tests. Iqvia also delivered a beat-and-raise report.

Intel Posts Surprise Loss

Intel (INTC) defied views for a tiny profit amid an ongoing corporate restructuring, though flat Q2 sales of $12.86 billion beat. For the current quarter, Intel expects to break even on an adjusted basis, below views, but guided slightly higher on revenue. Other chipmakers delivering disappointing June-quarter reports included NXP Semiconductors (NXPI), STMicroelectronics (STM) and Texas Instruments (TXN).

Stock Market News In Brief

Abivax (ABVX) skyrocketed nearly 600% on Wednesday after unveiling promising results for its experimental ulcerative colitis treatment. The biotech compared those who received the daily pill to a placebo group, looking to see who hit clinical remission. After eight weeks, the drug outperformed the placebo by 16.4%.