Mid-Morning Look

Wednesday, July 30, 2025

U.S. stock markets are steady, trading in a tight range ahead of big events coming up in one of the busiest days of the year both on the micro and macro side. Treasury refunding, ADP payrolls (came in better) and GDP for Q2 (came in better), earnings results from MSFT and META tonight, updates on trade/tariff news (Trump gives India 25% tariff starting 8/1), and of course the FOMC decision/Powell press conference all today. On the FOMC side of the equation rates will stay unchanged and the fireworks will come on the call, and the key will be how many dissenters (2 expected with Waller/Bowman expected to call for a cut). Meanwhile on data, ADP jobs rebounded after falling last month (ahead of nonfarm payrolls Friday), while the U.S. economy returned to growth in Q2 after contracting in the first, largely due to trade swings as the Commerce Department said U.S. gross domestic product (GDP) rose at a seasonally and inflation adjusted 3.0% annual rate, exceeding the 2.3% growth that economists expected. It followed a first quarter where GDP shrank at a (-0.5%) annual rate as businesses loaded up on imports to get ahead of the Trump administration’s anticipated tariffs. Consumer spending in Q2 increased at a 1.4% pace, picking up from the first quarter. The U.S. dollar index (DXY) hits fresh 5-week high after US data at 99.174, up 0.25% after GDP data as the Euro drops under $1.15; Treasury yields rebound on economic data after falling Tuesday. In other news, a powerful earthquake off the coast of Russia’s far east triggered tsunami warnings in Hawaii and California and sent people fleeing to higher ground across the Pacific, but initial fears subsided as the tsunami waves reached U.S. territory. The earthquake struck Russia’s Kamchatka Peninsula on the Pacific coast on Wednesday morning local time at magnitude 8.8, making it one of the 10 biggest on record if confirmed, according to the agency. Tons of big movers on earnings with ODFL, IEX, EHC, TT, GRMN among biggest losers in the S&P on earnings and TER, GNRC, HUM, EXE, EA among biggest winners.

• US advance Q2 GDP +3.0% (above consensus +2.4%); advance Q2 final sales +6.3% (vs. consensus +2.5%); advance Q2 consumer spending +1.4%; advance Q2 GDP deflator +2.0% (below consensus +2.1%); advance Q2 PCE price index +2.1% (consensus +2.9%) while advance Q2 core PCE +2.5% (consensus +2.3%).
• The National Association of Realtors said on Wednesday Pending Home sales, based on signed contracts, fell 0.8% last month. Economists polled by Reuters had forecast contracts, which become sales after a month or two, advancing 0.3%. Pending Home sales decreased 2.8% from a year earlier.
• US Treasury announces $125B refunding through October 2025, to raise new cash of $35.2B; US Treasury to keep coupon, floating rate note auction sizes ‘for at least the next several quarters; US Treasury to sell $58B in 3-year notes, $42B in 10-year notes, $25B in 30-year bonds next week; US Treasury to address seasonal, unexpected variations in borrowing needs in next quarter via changes in regular bill auction sizes and/or cash management bills.

• In Truckers: ODFL Q2 net income fell as the trucking line cited ongoing macroeconomic weakness for a slowdown in freight volumes and Q2 sales fell 6.1% to $1.41 billion, just shy of the mean analyst estimate of $1.42 billion, while less-than-truckload tons shipped per day fell 9.3%. WERN Q2 adj EPS $0.11 vs est. $0.05, adj op Inc $16.555Mm on revs $753.148Mm vs est. $733.9Mm, adj op mgn 2.2%. LSTR Q2 EPS was below the firm’s estimated $1.28 per share, while revenue was 100 basis points below the firm’s forecast due to van equipment and unsided/platform equipment sales.
• In Food: MDLZ reported Q2 results that met the consensus bar on top-line, but with weaker vol/mix that was attributed to consumer weakness + de-stocking in the US, and a heat wave in Europe. HSY Q2 EPS $1.21 vs. est. $1.00; Q2 revs $2.61B vs. est. $2.52B; cuts FY25 adjusted EPS view to $5.81-$6.00 from $6.00-$6.18 (est. $5.86) while backs FY25 revenue viewed up at least 2%. KHC reported sales that topped estimates, pointing to progress in winning over inflation-weary shoppers. FDP rallies on earnings results.
• In Semiconductors: MRVL shares jumped after 3^rd party research firm Fubon said that MSFT appears to be placing “higher expectations on Maia300 by MRVL, rather than Maia200, which is its own solution.” QRVO reported strong June results, beating street expectations by a wide margin for both the June quarter as well as for the September guide, benefiting from strong content gains at its largest customer, which is more than offsetting planned Android declines. STX shares fell as earnings beat, but guidance was disappointed; reported JunQ at $2.44B/$2.59 (cons $2.42B/$2.45) and guided in-line SepQ to $2.5B/$2.30 with higher GMT/2028 convert dilution impacting EPS. TER Q2 non-GAAP EPS $0.57 tops $0.54 estimate on revs $652M vs. est. $651.79M; said have seen a surge in demand as semiconductor makers invest in quality control while scaling up capacity to meet an artificial intelligence-led boom; guides Q3 revs $710M-$770M vs. est. $753M.

• HUM +6%; raised its annual profit forecast to be about $17 per share, compared with its previous estimate of about $16.25 (est. $16.38), as the U.S. health insurer bets on its efforts to rein in higher medical costs; reported Q2 medical cost ratio of 89.7%, up from 88.9% a year earlier, but in line with analysts’ estimates of 89.71%.
• LC +16%; as Q2 operating results beat the Street driven by higher revenue and a lower provision but was partially offset by higher expenses.  In addition, LendingClub exceeded its Q225 guidance for both originations and PPNR.
• MRVL +8%; after 3^rd party research firm Fubon said that MSFT appears to be placing “higher expectations on Maia300 by MRVL, rather than Maia200 which is its own solution.”
• VFC +19%; shares jumped after Q1 revs $1.76B tops consensus of $1.7B; posts Q1 EPS loss (-$0.24), less than the (-$0.34) loss estimate; results were helped by an uptick in demand for co’s apparel and footwear.
• VRT +5%; Q2 adj EPS $0.95 vs. est. $0.83; Q2 revs $2.64B tops consensus $2.36B; Q2 backlog was $8.5B and a book-to-bill ratio of approximately 1.2x for the quarter; raises FY25 adjusted EPS view to $3.75-$3.85 from $3.45-$3.65 (est. $3.58) and raises FY25 revenue view to $9.93B-$10.08B from $9.33B-$9.58B vs. est. $9.45B.
• VRDN +8%; entered into a collaboration/license agreement with Kissei for Veligrotug and VRDN-003 in Japan for $70MM up-front, up to $315MM in milestones, and tiered royalties of 20 to mid-30%.
• WING +26%; shares surged after raising its annual forecast for global unit growth rate range to 17% to 18%, from prior range 16% to 17% following a Q2 beat helped by an increase in royalty revenue, franchise fees and advertising fees.

• ODFL -9%; Q2 net income fell as the trucking line cited ongoing macroeconomic weakness for a slowdown in freight volumes and Q2 sales fell 6.1% to $1.41 billion, just shy of the mean analyst estimate of $1.42 billion, while less-than-truckload tons shipped per day fell 9.3%
• PANW -8%; after announces agreement to acquire CYBR in deal valued at $25B, a 26% premium as CYBR holders to receive $45 cash and 2.2005 shares of PANW.
• SHOO -10%; swung to a Q2 loss of -$39.5M from profit $35.4M y/y while revs rose to $559M (but missed est. $579M) and withdrew its 2025 guidance.
• SOFI -4%; pulling back from 52-week highs after 71.94M share Spot Secondary priced at $20.85.
• VYNE -72%; after announcing topline results from phase 2B trial with repibresib gel in nonsegmental vitiligo saying the trial did not meet primary endpoint or key secondary endpoint of f-vasi50 and f-vasi75; will terminate extension phase of trial and seek external partner for continued development of repibresib

Syndicate:

• MBQ (Ambiq Micro) 4M (up from 3.4M) share IPO, priced at $24.00 (range was $22 – $25
• CELC 1.837M share Secondary, priced at $38.00
• SOFI 71.94M Spot Secondary, priced at $20.85
• LRMR 18.75M share Spot Secondary, priced at $3.20