Closing Recap

Thursday, July 17, 2025

U.S. stock momentum continues to build, as the Nasdaq Composite hit a fresh all-time high along with the S&P 500 which topped and held around 6,300 as the Bull train continues higher. At the same time, the CBOE Volatility index (VIX) declined again, dropping -3% below the 17 level as investors continue to exhibit zero signs of fear into August 1^st tariffs. Economic data was a significant driver for sentiment today, with lower jobless claims, a stronger Retail Sales reading for June, a better Philly Fed Index, and import prices. Fed speakers included San Francisco Federal Reserve President Mary Daly who reiterated it is “reasonable” to expect two interest rate cuts before the end of this year, particularly with the impact of President Donald Trump’s tariffs looking more muted than originally expected. In sector news, Healthcare (XLV) was the big loser in the S&P 500 today following the weakness in managed care after ELV miss and lower guidance dragged down the sector while Technology (XLK) was the biggest winner behind mage cap tech movers and semiconductors (SOX) after TSM results/guidance, and Industrials (XLI) hit all-time highs. Netflix (NFLX) earnings tonight after the close will likely impact the media space tomorrow. Overall market breadth was more than2:1 advancers leading decliners as momentum still remains clear to the upside.

In weekly sentiment data: 1) The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was +0.3 vs +5.8 last week; Bulls fall to 39.3% from 41.4%; Neutrals fall to 21.8% from 23%; Bears rise to 39% from 35.6%. 2) This week’s NAAIM Exposure Index reading dipped to 83.69, falling from last week’s 86.28 – off recent highest reading of 99.30 on 7/2 – recent trough from 4-17 of 35.16 – Last Quarter Average (Q2) of 73.28. 3) more and more strength as coming into today, the S&P 500 (SPX) has closed above its 20-day MA for 55 consecutive trading days as of July 17, 2025, the longest streak since January 2021 (56 days) – note the 50dma support is down at 6,014 (vs 6,290 level today).

• Import Prices for June rose +0.1% (below est. +0.3%) and vs May -0.4%, while June export prices +0.5% (vs. consensus unchanged) and vs May -0.6%; U.S. June year-over-year import prices -0.2%, export prices +2.8%.
• Weekly Jobless Claims fell to 221,000 from 228,000 prior and well below consensus 235,000; the 4-week moving average fell to 229,500 from 235,750 prior week while continued claims climbed to 1.956M from 1.954M prior week vs. est. 1.965: and the US insured unemployment rate unchanged at 1.3%.
• Philadelphia Fed business conditions for July a strong reding at 15.9, well above consensus (-1.0) and vs June -4.0 as new orders jumped to 18.4 vs June 2.3 and employment index July 10.3 (best sequential change since April 2022) vs June (-9.8) and six-month business conditions July 21.5 vs June 18.3; prices paid also jumped in July to 58.8 vs June 41.4.
• July NAHB Housing market index 33, in-line with consensus 33 and versus 32 in June; July index of current single-family home sales 36 versus 35 in June; July index of home sales over next six months 43 versus 40 in June and index of prospective buyers 20 versus 21 in June (previous 21), lowest since December 2022.
• May Business Inventories unchanged (consensus unchanged) vs April unchanged; inventory/sales ratio 1.39 months’ worth vs April 1.38 months; May business sales -0.4% vs April -0.2% (prev -0.1%); and May retail inventories ex-autos unrevised at +0.2% (prev +0.2%).
• The Atlanta GDPNow model estimate for real GDP growth (seasonally adjusted annual rate) in the second quarter of 2025 is 2.4% on July 17, down from 2.6% on July 9.

• The U.S. dollar index (DXY) edges higher +0.3% at 98.70, rising against the Japanese yen, euro and Sterling following a round of much better-than-expected economic reports in the U.S.
• U.S. WTI crude oil futures settle at $67.54/bbl, up $1.16, or 1.75% while Brent crude prices gained $1.00 or 1.46% to settle at $69.52 per barrel, rebounding after 3-days of losses supported by better-than-expected U.S. retail sales and a delayed response to yesterday’s report of a 3.9-million-barrel U.S. crude stock draw.
• Treasury yields were little changed today after recent volatility as the 10-yr yield rose less than 1 bps to 4.462% while the 2-yr yield rose 3.2bps to 3.916% (yield is up 29.8bps from its 2025 closing low of 3.619% hit Wednesday, April 30, 2025).
• In Crypto: The U.S. House of Representatives passed a bill on Thursday that would develop a regulatory framework for cryptocurrencies and expand the Commodity Futures Trading Commission’s oversight of the industry. The move is a major win for the digital asset industry, which has pushed for federal legislation for years and spent heavily in last year’s elections to promote pro-crypto candidates.

• In Retailers: SHOO was upgraded to Buy at Citigroup and raised tgt to $32 from $26 saying Q2 EPS (7/30) will mark the low point for SHOO’s margins as they navigate significant tariff pressure this year. In Toy retailers, Bank America said they see Q2 EPS upside for HAS on significant momentum from Magic on likely most successful set release of all time (raise PT to $90 from $85) while for MAT, lowers its Q2 EPS to reflect more cautious & delayed retailer buying behavior & higher expense ratios.
• In Restaurants: SBUX was downgraded to Underperform from Hold at Jefferies with $76 tgt saying its credit and debit card data, as well as foot traffic and app data, suggest downside to Q3 and Q4 U.S. compare sales estimates. Jefferies also downgraded SHAK to Underperform from Hold (raise tgt to $120 from $100) saying investor optimism around the company’s near-term same-store-sales recovery is more than reflected in the stock following the recent rally.
• In Food Industry: MDLZ was upgraded to Buy from Hold at Jefferies (raise tgt to $78 from $66) noting the company spoke of a strong Easter with share gains in key markets, while the firm said Europe channel data supports the claim. The PEP results also helped food companies/snacks with HSY, CPB, GIS, UTZ rising early.
• In Tobacco: Reuters reported the FDA has authorized the sale of Juul’s e-cigarette device and refill cartridges in tobacco and menthol flavors. In other news, Goldman Sachs said they just learned from its industry trade contacts that MO USA announced late today a cig list price increase of $0.17-0.22/pk (or a ~3% increase) across its Marlboro brand as well as a $0.17/pk increase on L&M and a $0.22/pk increase on Benson & Hedges, Merit, Parliament and Virginia Slims. However, MO did not raise prices on Basic.

• In Auto news: LCID shares jumped after UBER said to invest $300M in lucid as part of robotaxi partnership; LCID also files preliminary proxy statement with the SEC to initiate plan for reverse stock split; CARS was upgraded to Overweight from Neutral at JP Morgan on valuation support and reduced cyclical risk. For B2C marketplaces, shares have underperformed franchise dealers YTD and since tariffs were officially announced, given the perceived risks from depleted supply medium-term.
• In Casino/Gaming: MCRI reported a +15% Q2 adj. EBITDA beat, riding the regional wave which has been trending strong quarter-to-date. Stifel said after the quarterly report, the firm’s 2025 and 2026 adjusted EBITDA forecasts move 5% higher (co raised tgt to $92 from $81) – shares were upgraded at Wells Fargo.

• In Solar: FSLR shares advanced after U.S. solar panel manufacturers ask commerce department to impose tariffs on imports from India, Indonesia and Laos.
• In Utility: nuclear names strong initially; OKLO rises after the company advances licensing for its Aurora powerhouse at Idaho National Laboratory (INL) with the completion of U.S. Nuclear Regulatory Commission’s (NRC) pre-application readiness assessment. Other nuclear names VST, NRG, CEG, TLN active after Seaport Global said they are optimistic about the 2026/27 PJM capacity auction results to be released July 22. Aggressive bidding of generation capacity and just a moderate increase in demand response should deliver pricing of $300+/MW-day.

• BPOP increases quarterly dividend to $0.75 and announces $500M share repurchase plan.
• CFG Q2 EPS $0.92 vs. est. $0.88; Q2 revs $2.04B vs. est. $2.01B; said results were paced by strong NII and fee growth, disciplined expense management
• FITB Q2 EPS $0.88 vs. est. $0.87; see FY25 NII up 5.5%-6.5% y/y; Q2 provisions for credit losses $173M down slightly q/q; NII rose 7.7% to $1.50B, surpassing the est. $1.48B.
• MCB announces initial cash dividend of $0.15 and approves $50M share repurchase plan (ahead of earnings expected tonight).
• OFG Q2 EPS $1.15 vs. est. $1.05; Q2 revs $182.2M vs. $181.5M; Q2 CET1 capital ratio 13.99%.
• SNV Q2 core EPS $1.48 topped the $1.25 estimate with the bottom line beat larger driven by a big provision beat. Relative to expectations, core PPNR came in modestly higher than expected as core fee income came in better than expected ($131M), while core expenses were a touch better.
• TFIN Q2 EPS $0.15 vs est. $0.06 on NII $88.678Mm vs est. $88.27Mm
• USB Q2 EPS $1.11 vs. est. $1.07; revs rose 2% y/y to $7B vs. est. $7.07B; sees FY25 total net revenue up 3%-5% vs. FY24; Q2 net interest income rose 0.7% to $4.05B; Q2 Noninterest income was 3.9% higher at $2.92B.

• In FinTech (XYZ, PYPL, AFRM, UPST): a report in The Information noted the fintech industry has gone to the Trump administration to try to block the threat by banks, led by JPM, to charge FinTechs fees for accessing their customers’ banking data. Under proposed pricing sheets from JPMorgan, the fintech and crypto industries could face hundreds of millions of dollars in costs to get access to their customers’ bank account information, which they now get for free. The data allows companies like Venmo and Coinbase to easily accept fund transfers from customers, verify their bank balances, and gain insights into their financial history to provide loans.

• ALL announces June catastrophe losses of $619M and Q2 catastrophe losses total $1.99B.
• MMC Q2 adj EPS $2.72 above consensus $2.67; Q2 revs $7.0B vs. est. $6.93B.
• PFG said AUM is $752.7B as of June 30; separately was downgraded to In Line from Outperform at Evercore with a $275 tgt saying does not see much share downside from current levels but struggles to see any upside given where the company is in the cycle.

• REXR Q2 Core FFO/SHR $0.59 vs est. $0.59 on revs $249.5Mm vs est. $248.95Mm; same-property occupancy 96.1%; guides FY Core FFO/SHR $2.37-2.41 vs est. $2.40.
• SLG Q2 FFO $1.63 vs. est. $1.38; raises 2025 FFO view to $5.65-$5.95 from $5.25-$5.55 vs. est. $5.47; Q2 Same-store cash net operating income (NOI) fell -1% and increased by 0.7% for 1H’25.

• BMY and PFE announced a new direct-to-patient option for purchasing Eliquis (apixaban) via Alliance’s patient resource Eliquis 360 Support. The offer provides an opportunity for uninsured, underinsured, or self-pay patients to significantly lower their out-of-pocket costs for this critical medicine.
• GSK shares declined as the FDA panel voted against GSK’s blood cancer drug Blenrep in combination with bortezomib and dexamethasone in previously treated patients.
• NVS Q2 core EPS $2.42 vs. est. $2.37; Q2 revs $14.05B vs. est. $14.08B; launched a share buyback of up to $10 billion and raised its full-year profit guidance as now projects core operating profit to grow by a low-teens percentage this year vs. prior view an increase by low double digits; said long-time CFO to be replaced.
• SRPT shares jumped after announces strategic restructuring and pipeline prioritization plan to maintain long-term, sustainable growth and provides update on Elevidys label; announces $400M cost savings, 36% workforce reduction; guides Q2 revenue $513M vs. est. $528.4M; said expects to submit BLA for SRP-9003 for LGMD type 2e/r4 in 2H’25; on FDA request, agreed to include black box warning for Elevidys label.
• In Managed Care: more pain for the sector after ELV Q2 adj EPS $8.84 misses the consensus $9.19; Q2 revs $49.4B vs. est. $48.26B; cuts FY25 adjusted EPS view to ~$30.00 from $34.15-$34.85 (est. $34.48) given the ongoing and industry-wide impact of elevated cost trends in ACA and Medicaid; saw membership losses in both Medicaid and ACA which resulted in higher acuity; said benefit expense ratio was 88.9% up 260 basis points y/y (shares of UNH, HUM, CI, MOH were weak early in reaction as bad news continues to plague sector).

• In the E&C Sector: PWR was downgraded to Market Perform from Outperform at BMO Capital but raise tgt to $400 (from $352) saying to be clear, this is strictly a valuation call. BMO believes scale, breadth, and high voltage expertise sets PWR apart from typical E&C peers and warrants a substantial premium. ABB posted its highest-ever quarterly order intake, rising 37% in Q2, helped by surging demand from the United States and for products used in data centers being built to support artificial intelligence (comp ETN, ROK, EMR shares rise on results).

• AIR Q4 adj EPS $1.16 vs est. $1.01, adj EBITDA $91Mm vs est. $82.67Mm on sales $755Mm vs est. $695.71Mm.
• BWXT announced the award of U.S. Naval Nuclear Propulsion Program contracts totaling approximately $2.6B, including future year options, for manufacturing naval nuclear reactor components.
• LHX shares hit 52-week highs after the aerospace and defense co announced plans to expand Arkansas solid rocket motor production facilities.

• In Metals & Mining: aluminum producer AA reported Q2 adj EPS $0.39 vs. est. $0.31; Q2 revs $3.01B vs. est. $2.9B; Q2 adj Ebitda $313M vs. est. $271.6M; said expects 2025 total aluminum segment production to remain unchanged from its prior projection; for Q3, aluminum segment expects sequential unfavorable impacts of approximately $90M due to tariffs.
• In Materials: MP shares slide after massive run this month after announces commencement of proposed $500M public offering of common stock – 11.8M share Spot Secondary, priced at $55.00.

• In Media: Peacock, a streaming service by CMCSA’s NBCUniversal, said it will raise prices by $3 later this month and begin testing a new narrowed-down tier for users. The price for Peacock’s ad-supported premium plan will increase to $10.99 per month, while the premium plus plan will now be priced at $16.99 per month.
• In the Optical Sector: JP Morgan said within AI leveraged suppliers, sees significant upside across the board for all Optical companies, including COHR, LITE and CIEN, the OW-rated optical equipment companies in its coverage. Outlook is favorable for AI companies and their leverage to robust spending from Cloud companies in relation to drivers of estimate revisions, but at the same time the rich valuation premiums at this time limit the magnitude of upside for AI companies
• In AI/Data Center news: META CEO Mark Zuckerberg has pledged hundreds of billions of dollars towards building massive data centers, days after ratcheting up the AI race with the launch of a division made up of engineers poached from rivals he hopes to challenge. CRWV shares slipped after HSBC initiated coverage with a Reduce rating and Street-low PT $32.

• SK Hynix (HXSCL) was downgraded to Neutral from Buy at Goldman Sachs with an updated TP of W310,000 implying 5% upside saying believes HBM pricing could decline for the first time in 2026, with increasing competition and pricing power gradually shifting to the major customer where Hynix has an outsized exposure.
• In Research, JP Morgan with a few changes as they downgraded TER to Neutral from Overweight on likelihood of pauses in capital spending from customers as well as sluggish cyclical recovery; placed CDW on positive catalyst watch in expectation for upside to Q2 revenue/ earnings from robust PC volumes, leading to modest upside to FY25 outlook and added SMCI on negative catalyst watch (but raise PT to $46 from $35) in expectation that upside in relation to AI demand drivers is likely to be offset by margin pressures stemming from an increasingly competitive landscape.