Alphabet results take S&P 500, Nasdaq to record highs; Dow falls
At 11:33 a.m. ET, the S&P 500 (.SPX), opens new tab gained 15.92 points, or 0.25%, to 6,374.83 and the Nasdaq Composite (.IXIC), opens new tab gained 53.37 points, or 0.25%, to 21,072.20.
Alphabet (GOOGL.O), opens new tab rose 1.9% after the Google parent raised its 2025 capital spending forecast by $10 billion to $85 billion, shrugging off trade jitters, and reinforcing investors' confidence in AI investments and returns.
Shares of Microsoft (MSFT.O), opens new tab, Nvidia (NVDA.O), opens new tab and Amazon (AMZN.O), opens new tab were up between 0.9% and 1.7%.
Losses in UnitedHealth (UNH.N), opens new tab, IBM (IBM.N), opens new tab and Honeywell weighed on the blue-chip Dow (.DJI), opens new tab, which fell 0.33% - though it remained close to its December 4 record high.
UnitedHealth lost 3.7%. The insurer revealed it's cooperating with a Department of Justice probe into its Medicare practices, following reports of both criminal and civil investigations.
IBM dropped 8% as its second-quarter results fell flat with investors, hampered by disappointing sales in its core software division.
Honeywell, meanwhile, dipped 4.6% despite topping Wall Street's expectations and raising its annual outlook.
Electric vehicle maker Tesla (TSLA.O), opens new tab tumbled 9%, as CEO Elon Musk warned of "a few rough quarters" due to cuts in EV incentives. The stock has fallen about 25% for the year so far.
"Tesla was declining in terms of its core business, which is automobiles, prior to his (Elon Musk) political involvement," said Thomas Hayes, chairman at Great Hill Capital.
"Deliveries were going down, demand was going down and he took his eye off the ball and now it's gone down a lot."
On the trade front, an EU spokesperson hinted that a deal was "within reach"—one that could slap a broad 15% tariff on imports across the 27-member bloc, according to diplomats.
Meanwhile, fresh signs of progress emerged after President Donald Trump struck an agreement with Japan, slicing tariffs on Japanese goods to 15%. China and South Korea are also scrambling to clinch their own deals and sidestep Trump's hefty duties.
Some of Wall Street's heavyweights were starting to feel the sting of Trump's sweeping tariffs. American Airlines (AAL.O), opens new tab fell 9.2% after forecasting a bigger-than-expected third-quarter loss, hurt by sluggish domestic travel demand.
The U.S. trade war has created the biggest uncertainty for the airline industry since the COVID-19 pandemic.
Markets were also monitoring Trump's surprise visit to the Federal Reserve's headquarters later in the day, which followed months of the president criticizing Fed Chair Jerome Powell for not cutting interest rates.
With the Fed widely expected to hold rates steady at next week's meeting, traders are now pricing in a 60.4% chance of a September rate cut, according to CME's FedWatch tool.
The latest Labor Department report showed weekly jobless claims fell to 217,000—well below estimates—signaling continued resilience in the U.S. job market.
U.S. business activity gained momentum in July, but companies hiked prices on goods and services—a move that's fueling economists' predictions of faster inflation in the months ahead, largely driven by rising import tariffs.
Declining issues outnumbered advancers by a 1.56-to-1 ratio on the NYSE and by a 1.7-to-1 ratio on the Nasdaq.
The S&P 500 posted 41 new 52-week highs and three new lows, while the Nasdaq Composite recorded 65 new highs and 24 new lows.
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