S&P 500 Closes at Record High

The S&P 500 closed at a record high of 6,363.35, up 0.07% from the previous day, after Alphabet's latest quarterly results came in better than expected [1]. This move marks the 12th record close of the year for the S&P 500, with the index gaining 0.22% heading into the market close.

Market Reaction

The S&P 500 and the Nasdaq Composite eked out record closes on Thursday, with the broad market index adding 0.07% to end at 6,363.35, and the tech-heavy Nasdaq rising 0.18% to close at 21,057.96 [1]. The Dow Jones Industrial Average, however, fell 316.38 points, or 0.70%, to settle at 44,693.91, bogged down by shares of IBM slipping more than 7% after its second-quarter software revenue missed expectations. The market's reaction was also influenced by the ongoing feud between President Donald Trump and the Federal Reserve, with the White House announcing that Trump will visit the Fed, escalating his pressure campaign against Chairman Jerome Powell [1].

Earnings and Trade Developments

Alphabet's strong earnings report was a significant factor in the market's move, with the company's shares rising 1% after it posted a second-quarter earnings and revenue beat [1]. Ross Mayfield, investment strategist at Baird, noted that the Alphabet results were a "nice little tailwind" for the market, which is constantly asking whether big tech's AI spend will have a solid return on investment [1]. Meanwhile, investors are also watching for developments on the trade front, with the U.S. reportedly inching closer to a trade deal with the European Union, which would raise tariffs to 15% on imports from the EU [1].

What to Watch

• The next earnings report from Apple, which is expected to show strong revenue trends and a beat on gross margins [1]
• The progress of trade talks between the U.S. and the European Union, with the potential for a trade deal to raise tariffs to 15% on imports from the EU [1]
• The Federal Reserve's response to President Trump's pressure campaign, with the potential for a rate cut or other monetary policy changes [1]

The S&P 500's record close marks a significant milestone for the market, but investors are still watching for potential risks and challenges, including the ongoing trade tensions and the impact of AI spend on big tech's bottom line. As the market continues to evolve, investors will be closely monitoring the next earnings reports and trade developments to gauge the market's direction.