Markets Overview

News Market Overview

• DXY (US Dollar Index): Limited news data available, but Treasury yields have been trending lower with the 10-year yield falling to 4.35% (down 6 basis points) and the 2-year yield at 3.84% (down 2 basis points) as of July 21. This yield curve movement suggests potential dollar weakness as markets anticipate possible Fed rate cuts, especially following Trump's denial about firing Powell which temporarily steepened the yield curve.

• RTY (Russell 2000): No specific Russell 2000 news available, but small caps likely benefiting from the broader market optimism. The positive retail sales data (+0.6% M/M vs +0.1% expected) indicates stronger consumer spending, which typically benefits small-cap domestic companies more directly than multinational firms.

• DJI (Dow Jones Industrial Average): The Dow has shown mixed performance, climbing 0.2% on July 21 but lagging behind other indices with a 0.3% decline on July 18, weighed down by American Express. The blue-chip index appears more sensitive to earnings disappointments and less buoyed by the tech optimism driving other indices to record highs. Verizon's 4% gain after raising profit forecasts provided some support.

• SPX (S&P 500): The index reached its 9th all-time high of 2025 as of July 18, continuing its upward momentum with a 0.4% gain on July 21. Market sentiment remains positive despite political uncertainty, supported by strong Q2 earnings with 86% of reporting companies beating expectations. Sector performance shows strength in Communication Services, while Energy has been the weakest performer as oil prices declined 1.1%.

• NDAQ (Nasdaq Composite): Leading market gains with a 0.7% advance on July 21 as investors anticipate big tech earnings from Tesla, Alphabet, and Intel later in the week. The tech-heavy index continues setting new record highs despite Netflix falling over 5% after its earnings report. The tech sector appears to be driving overall market momentum, with investors showing continued confidence in growth prospects.

• Broader Market Themes: Several key themes are emerging: (1) Political uncertainty around Fed leadership has created volatility but appears contained after Trump denied plans to fire Powell; (2) Inflation concerns are easing with softer-than-expected wholesale inflation data supporting the case for Fed rate cuts; (3) Consumer resilience is evident in stronger-than-expected retail sales data (+0.6% vs +0.1% forecast); (4) Q2 earnings season is showing remarkable strength with 86% of reporting companies beating expectations; (5) Housing market shows unexpected strength with building permits and housing starts rising more than expected in June.