Wall St opens muted with corporate earnings, trade talks in focus
The Dow Jones Industrial Average (.DJI), opens new tab rose 15.6 points, or 0.04%, at the open to 44338.62. The S&P 500 (.SPX), opens new tab rose one point, or 0.02%, at the open to 6306.6, while the Nasdaq Composite (.IXIC), opens new tab rose 8.0 points, or 0.04%, to 20982.205 at the opening bell.
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Reuters
19 minutes ago
- Reuters
Morning Bid: Fizzy market week turns flat
LONDON, July 25 (Reuters) - What matters in U.S. and global markets today By Mike Dolan, opens new tab, Editor-At-Large, Finance and Markets A buoyant week for world markets driven by emerging U.S. trade deals with major economies has gone a bit flat into Friday, with the corporate earnings season throwing up a series of high profile disappointments. The interest rate backdrop also turned a shade darker, with the European Central Bank holding its 2% rate steady as expected but with some officials signalling that the bar was high for further easing. Federal Reserve rate cut expectations also continued to tick lower despite relentless political pressure, with futures markets now pricing in just 42 basis points of additional easing this year. * The S&P 500 and Nasdaq eked out marginal gains to new records on Thursday, with Alphabet leading the way after its earnings beat. But Tesla's troubles continued, as it dropped more than 8%. Meanwhile, IBM clocked an 8% earnings day drop, American Airlines fell 10% and Honeywell was off 6%. UnitedHealth lost 5% after a probe into its Medicare practises, and Intel lost 5% overnight on its update. Wall Street futures were flat ahead of Friday's bell. * The European earnings season was also pockmarked with some negative reactions to corporate updates, with shares in German sportswear maker Puma sliding 15% on Friday and French car parts maker Valeo down 9% as both cut full-year outlooks. European stock indexes were down about 0.5%. A rebound in British retail sales last month came in below forecasts too. * A packed diary next week includes the August 1 U.S. tariff deadline, Federal Reserve and Bank of Japan meetings, key U.S. labor market updates, megacap earnings and a heavy Treasury debt auction schedule. Treasury yields were steady to a bit higher on Friday and the dollar nudged up too. Market Minute * Investors cashed out of highly valued global stocks on Friday and the dollar headed for its biggest weekly drop in a month ahead of a crucial week for markets that includes Donald Trump's tariff deadline and key central bank meetings. * U.S. President Donald Trump's trade deal with Tokyo opens scope for the Bank of Japan to raise interest rates again this year, sources say, a prospect the central bank may start to telegraph by offering a less gloomy view on the economic outlook. * South Korea's Industry Minister Kim Jung-kwan met U.S. Commerce Secretary Howard Lutnick on Thursday and reaffirmed a commitment to reach a deal on tariffs by the August 1 deadline, South Korea's industry ministry said on Friday. * The optimism sweeping world stock markets following news of emerging and expected U.S. trade deals is undeniable and understandable. But, writes ROI markets columnist Jamie McGeever, it is also puzzling. * U.S. President Donald Trump sprang a double surprise on the copper market when he announced import tariffs of 50% effective next month. ROI metals columnist Andy Home notes that the market was betting on a different outcome. Weekend reads * GEN AI AND PRODUCTIVITY: The Generative AI boom shows encouraging signs of raising the productivity level, opens new tab of the wider economy, according to a Federal Reserve Board discussion paper. But the researchers conclude that GenAI's contribution to productivity growth will depend on the speed with which its benefits are obtained, and notes that historically it takes time for revolutionary technologies to be integrated into the economy. * SUBNATIONAL DEBTS: Debates about debt sustainability often only focus only on "sovereign" or central government balances and ignore a complex, growing role of subnational governments., opens new tab In a piece on CEPR's VoxEU site, economists Sean Dougherty, Acaua Brochado and Pietrangelo de Biase point out how subnational government accounts for nearly 40% of public investment and more than a quarter of public spending. They argue these entities face tighter borrowing conditions, increasing investment responsibilities and market structures that often fail to price risk accurately. Left unaddressed, these dynamics could undermine both macro stability and government priorities. * DIGITAL SOVEREIGNTY: Europe's systemic dependency on Big Tech's social-media, opens new tab platforms threatens the continent's digital sovereignty as policymakers argue there's little alternative. But, as developer Sebastian Vogelsang argues on Project Syndicate this week, this ignores the potential for building apps on open-source frameworks like the AT Protocol, the foundation for Bluesky. * 'SPY COCKROACHES'?: For Gundbert Scherf - the co-founder of Germany's Helsing, Europe's most valuable defence start-up - Russia's invasion of Ukraine changed everything. As Reuters' Supantha Mukherjee, Sarah Marsh and Christoph Steitz report, the Munich-based company more than doubled its valuation to $12 billion at a fundraising last month. Scherf - a former partner at McKinsey - says Europe may be on the cusp of a transformation in defence innovation akin to the Manhattan Project. * SYRIA'S ECONOMICS: A Reuters investigation found that Syria's new leadership is secretly restructuring an economy broken by corruption and years of sanctions against Assad's government, under the auspices of a group of men whose identities have until now been concealed under pseudonyms. Away from public scrutiny, the committee obtained assets worth more than $1.6 billion. That tally is based on accounts of people familiar with its deals to acquire business stakes and cash seizures, including at least $1.5 billion in assets taken from three businessmen and firms in a conglomerate once controlled by Assad's inner circle. Chart of the day With Fed policy under a microscope, attention switches to the labor market next week - culminating in the release of the national employment report on Friday. Economists polled by Reuters expect the economy added 102,000 non-farm payrolls this month - which would be the lowest monthly tally since February. However, the U.S. Labor Department on Thursday showed jobless claims last week fell to 217,000 - well below estimates - signaling continued resilience in the job market. Today's events to watch * U.S. June durable goods orders (8:30 AM EDT) * U.S. corporate earnings: Aon, HCA Healthcare, Charter Communications, Phillips 66, Centene * South Korea's Finance Minister Koo Yun-cheol and Minister for Trade Yeo Han-koo meet U.S. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer in Washington * U.S. President Donald Trump makes private visit to Scotland -- Want to receive the Morning Bid in your inbox every weekday morning? Sign up for the newsletter here. You can find ROI on the Reuters website, and you can follow us on LinkedIn Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, opens new tab, is committed to integrity, independence, and freedom from bias.
Reuters
19 minutes ago
- Reuters
US stock futures largely steady after record run for S&P 500, Nasdaq
July 25 (Reuters) - Wall Street futures were largely unchanged on Friday, as investors caught their breath after record closes for the S&P 500 and the Nasdaq and looked for clarity on U.S. trade talks before the August 1 tariff deadline. At 06:50 a.m. ET, Dow E-minis were up 68 points, or 0.15%, S&P 500 E-minis were up 8.25 points, or 0.13%, and Nasdaq 100 E-minis were up 10.5 points, or 0.04%. The blue-chip Dow fell 0.7% in Thursday's session, but remained close to its all-time high, last hit in December. All three major indexes were poised to cap the week on a high note, as fresh signs of progress emerged on deals between the United States and its trading partners including Japan, Indonesia and the Philippines, which helped propel markets to new highs. Hopes for an agreement with the European Union were building, while negotiations with South Korea gathered steam ahead of the fast-approaching August 1 deadline. Investors are hoping for a resolution by that date which could sidestep hefty U.S. import tariffs. The markets' record run was also aided by a wave of upbeat second-quarter earnings. Of the 152 companies in the S&P 500 that reported earnings as of Thursday, 80.3% reported above analyst expectations, according to data compiled by LSEG. However, there were a few setbacks this week. Heavyweights Tesla (TSLA.O), opens new tab and General Motors (GM.N), opens new tab stumbled and were on track for their steepest weekly declines in nearly two months. Tesla's slide followed CEO Elon Musk's warning of tougher quarters ahead as U.S. EV subsidies dwindle, while General Motors took a hit after absorbing a $1.1 billion blow from President Donald Trump's sweeping tariffs in its second quarter earnings. Intel (INTC.O), opens new tab dropped 7.8% in premarket trading on Friday after the chipmaker forecast steeper third-quarter losses than Wall Street had estimated and announced plans to slash jobs. "Tariff headlines are driving market risk sentiment fuelling a risk-on mood this week. However, some volatility near the August 1st deadline remains possible," a group of analysts led by Adam Kurpiel at Societe Generale said. All eyes will be on the U.S. Federal Reserve next week when policymakers gather for a closely watched meeting. Wall Street is betting they will hit the pause button again on interest rates while sizing up tariff-fueled inflation. But the central bank isn't just facing economic headwinds — politics is also increasingly in the mix as Trump continues to ramp up his pressure campaign for lower rates after a rare visit to the Fed's headquarters on Thursday. A frequent critic of Fed Chair Jerome Powell, Trump has openly floated the idea of replacing him with someone more dovish — a stance that analysts noted is nudging investors to start pricing in looser monetary policy. According to CME's FedWatch tool, traders now see a nearly 60% chance of a rate cut as soon as September. Among other stocks, Newmont (NEM.N), opens new tab added 2.1% after the gold miner surpassed Wall Street expectations for second-quarter profit. Health insurer Centene (CNC.N), opens new tab posted a surprise quarterly loss, sending its shares tumbling 10%. Paramount Global (PARA.O), opens new tab rose 1.3% after U.S. regulators approved its $8.4 billion merger with Skydance Media.
The Guardian
19 minutes ago
- The Guardian
AI-backed medical debt company claims payment plans can help US healthcare costs
The CEO of the artificial intelligence-backed medical debt purchasing company PayZen believes payment plans can be part of the solution to America's high-priced healthcare, even as consumer rights advocates warn third-party financial agreements lack transparency. The company is just one in a sea of healthcare financing companies, whose executives see 'acceleration' in conversations with cash-strapped hospitals facing historic Republican-led healthcare cuts. Signed into law by Donald Trump, the cuts are expected to leave 17 million people without insurance through 2034. As those uninsured people struggle to pay for healthcare, the change is effectively a cut to hospital revenue, and threatens some cash-strapped facilities with closure. 'We believe most people want to pay their bills – they're decent people trying to be responsible,' said Itzik Cohen, PayZen CEO. 'It's not a collections problem – it's an affordability problem.' PayZen's solution is to provide payment plans up to 60-months with 0% interest. 'If you extend the payment plan to three, four, five years … Then more people will pay their bills and successfully,' said Cohen. 'What we're trying to do is make it affordable.' PayZen's business model relies on buying debt from hospitals at a discount, and is backed by venture capital from groups such as New Enterprise Associates, a New York-based firm with big-name partners such as Dr Scott Gottlieb, the president's first-term Food and Drug Administration (FDA) commissioner. NEA and Gottlieb deferred requests for an interview. PayZen may pay as little as 10% and as much as 90% of the value of the bill depending on an AI-backed prediction of whether the patient will pay, according to a 2022 contract with the University of Texas Medical Branch Health (UTMB) at Galveston obtained by the Guardian. The company then collects the full face value of the bill from patients. That same contract shows that PayZen also charges hospitals a transaction based 'platform fee'. 'PayZen charges a 5% platform fee to support outreach, enrollment, underwriting and serving all payment plans,' it reads. Cohen declined to comment on platform fees and said the 5% figure 'is not accurate and is not reflective of how our pricing works'. PayZen is part of an industry of companies, some of which provide interest-bearing financing, that help cash-strapped hospitals with a growing a liquidity problem. 'This is not a new business. It is based on an old model,' said Ge Bai, a healthcare finance professor at Johns Hopkins University's Carey School of Business. 'A hospital takes the unpaid bill to a financial institution, sells these bills to the financial institutions, then the financial institution will give them [the hospital] money immediately… It changes ownership.' Chief among hospitals facing liquidity problems are rural facilities – 153 of which have closed or lost key hospital services since 2010. For these facilities, government cuts, expected to result in an $87bn drop in revenue are only the latest blow. Over the last decade, insurers have increasingly pushed costs onto patients. From 2006 to 2025, the average deductible – an upfront payment that must be made before insurance kicks in – for a single person has grown from $303 to $1,562, outpacing inflation by more than 352%. Those payments represent a hardship for many Americans, more than one-third of whom can't afford an unexpected $400 expense. Unpaid, they also turn into bad debt on a hospital balance sheet. In 2022, people with health insurance became the largest group of patients in debt to hospitals – a sea change in the industry. And those debts, known as 'patient responsibility' or 'self-pay' are very hard for providers to collect. Companies like PayZen come in and pay hospitals up front for bills that might otherwise languish on the hospital balance sheet and become bad debt. 'Because of the growth in high deductible health plans, many people have $2,500, $10,000 [deductibles] for families – so they're really financing so much of their care,' said Richard Grundling, chief mission impact officer at the Healthcare Financial Management Association (HFMA). Consumer advocates question the transparency of such deals for patients. 'I don't think there's any transparency to the patient that PayZen has just acquired this account at a fraction of its face value,' said April Kuehnhoff, senior attorney at the National Consumer Law Center. UTMB Health confirmed that it does not tell patients that PayZen bought their debt at a discount. 'If the hospital was willing to accept this reduced amount, was there a discount that the patient could have accessed by directly paying the hospital instead of paying the full amount to this third party company?' Kuehnhoff asked. Advocates also argue there is a risk that low-income patients, who are often eligible for federally required discounted care, are caught up in payment plans. UTMB Health confirmed that PayZen does not screen patients for what is commonly called 'charity care,' despite performing a 'soft' credit pull and information on their debt and incomes. 'UTMB directs all patients to PayZen to discuss the terms and conditions of the specific agreements with PayZen,' said a spokesperson for the hospital system. 'We provide basic FAQ information, but the relationship is between the patient and PayZen.' Although PayZen relies on purchasing debt, Cohen objects to the label 'debt buyer', which he said refers to companies buying bundles of debt in default. Such companies were highlighted in a segment on John Oliver's Last Week Tonight. 'Calling it debt buying is insulting to patients quite frankly,' said Cohen. 'When you purchase something with a [buy now, pay later] approach, is it debt buying? You're being offered a way to pay for your purchase in a convenient, integrated way that extends payments to you because now you can afford it.' Cohen said his company does not use 'extraordinary collection practices', such as filing debt law suits and objects to describing PayZen as 'buy now, pay later'. 'We never actually called ourselves 'buy now, pay later' for healthcare or 'care now, pay later'.' In fact, Cohen authored a 2021 blog post on the company website headlined: 'PayZen's 'Care Now, Pay Later' Mission.' He later clarified that his company has moved beyond that description. Cohen said PayZen is running a 'pilot' to pre-qualify accounts for charity care, but that only 'two to three' of the roughly 100 healthcare providers it works with participate. Some states require hospitals to screen patients for charity care. If hospitals continue to struggle to collect money from patients, Bai noted that 'hospitals will engage in even more aggressive mechanisms'. 'For example, all upfront payments – no payment, no service – this will happen,' Bai added. UTMB Health instituted one such policy, which was presented in a PayZen-sponsored report as 'masterclass in revenue optimization'. The hospital required patients to pay before seeing a doctor as early as 2019. However, the implementation reportedly led to loud exchanges in waiting rooms, as patients argued they could not afford to pay before seeing the doctor, according to local news outlets. In 2023, UTMB publicly affirmed its payment-first policy, and contracted with PayZen to provide patients with long-term pay plans through its AI-backed debt purchasing model. 'When thoughtfully implemented, pre-service payment policies can significantly increase collections without driving care avoidance,' the PayZen-sponsored report said.
