Markets Rally on Strong Data

The US stock market finished Thursday with fresh record highs, as investors responded positively to strong economic indicators and robust earnings reports. The data reinforced confidence that American consumers remain willing to spend, despite looming trade concerns.

Tech Stocks Lead the Charge

The Nasdaq Composite climbed by 153.78 points, or 0.74 percent, ending the session at 20884.27. It marked the sixth record close in the past seven trading days. The S&P 500 advanced by 33.66 points, up 0.54 percent, finishing at 6297.36. Meanwhile, the Dow Jones Industrial Average gained 229.71 points, a 0.52 percent rise, closing at 44484.49.

A Comeback After Spring Volatility

Wall Street's latest rally follows a period of volatility earlier this year, triggered by former President Donald Trump's announcement of new tariffs in early April. Markets dipped at the time but have since staged a strong comeback. This week has been particularly pivotal, with the release of critical economic data and the kickoff of the second-quarter earnings season.

Fed Holds Steady Amid Trade Uncertainty

Investors are closely watching whether the tariff measures are beginning to impact the broader US economy. The Federal Reserve has indicated that it will not consider cutting interest rates unless there is clear evidence that tariffs are pushing inflation higher. On Thursday, Fed Governor Adriana Kugler confirmed this stance, stating that the central bank is pausing any rate adjustments as it monitors how trade policy may influence consumer prices.

Markets bet on rate cuts later, not sooner

According to CME's FedWatch tool, traders now see a roughly 54 percent chance that the Federal Reserve could lower interest rates in September. A rate cut in July, however, appears nearly off the table, pointing to a cautious stance amid ongoing inflation monitoring.

Retail resilience surprises investors

Strong retail sales figures were matched by upbeat commentary from major consumer-oriented companies. Shares of PepsiCo jumped 7.5 percent after the company issued a promising outlook, citing rising demand for energy drinks and healthier sodas. This helped to ease concerns about weaker annual core earnings.

Airlines see clear skies ahead

United Airlines climbed 3.1 percent after signaling stronger-than-expected travel demand since early July. The news stood out as a rare bright spot in an airline industry still grappling with government spending cuts and international trade tensions. Shares of Delta and American Airlines also gained more than 1.4 percent each.

Semiconductor stocks ride the AI wave

Tech shares, particularly in the chipmaking sector, continued to benefit from accelerating demand for artificial intelligence technologies. Taiwan's TSMC, the world's top producer of advanced AI chips, reported record-breaking quarterly profits, reflecting strong momentum in the industry.

US-listed TSMC shares rose 3.4 percent, while Marvell and Nvidia also saw gains of 1.6 and 1 percent respectively. Ameriprise strategist Anthony Saglimbene said TSMC's results bode well not only for chipmakers but for the entire tech sector, as interest in AI continues to grow.

Industrials and tech set fresh records

Thursday's trading session ended on a high note as both the industrial and tech indices reached new all-time highs. But it was the financial sector that stole the spotlight, climbing 0.9 percent and outperforming the nine sectors that closed in positive territory.

Netflix beats expectations on Squid Game finale

Netflix shares rose 1.9 percent ahead of its earnings release. The streaming giant reported results that exceeded Wall Street's expectations, fueled in large part by strong global interest in the final season of its blockbuster series Squid Game. A weaker US dollar also boosted international revenue, giving the company an additional lift.

Asian markets rally after Wall Street surge

Asian stocks followed the upbeat momentum from US markets into Friday. Solid economic indicators and strong corporate earnings helped offset ongoing concerns about tariffs. The MSCI index covering Asia-Pacific equities outside Japan rose 0.7 percent, marking its highest level since late 2021 and ending the week up 1.5 percent.

Japan's Nikkei slips ahead of elections

Japan's Nikkei index declined 0.2 percent, while the yen weakened further, dropping 0.1 percent against the dollar. The Japanese currency has now lost around 0.7 percent this week as pre-election polls show Prime Minister Shigeru Ishiba's ruling coalition may lose its upper house majority in Sunday's vote.

European and US futures signal further gains

European markets appear poised for a higher open, with EUROSTOXX 50 futures climbing 0.4 percent. Wall Street futures also edged higher, gaining 0.2 percent in early trading.

Temporary relief, persistent pressure

Japan's latest inflation report, released Friday, showed a slight easing of core inflation in June, largely due to short-term reductions in utility costs. Despite the slowdown, inflation remained above the Bank of Japan's two percent target, continuing to raise concerns among households and economists alike.

Rising costs, falling approval

The rising cost of living — particularly the sharp increase in staple goods like rice — is taking a toll on public sentiment. Prime Minister Shigeru Ishiba is feeling the political heat, as his approval ratings face downward pressure amid persistent economic headwinds.

Chinese and Hong Kong markets edge up

Elsewhere in Asia, markets posted modest gains. China's benchmark for blue-chip stocks rose 0.4 percent, while Hong Kong's Hang Seng Index advanced by 0.8 percent. The moves reflect a cautiously optimistic mood among investors in the region.