Major Indexes Hold Near Record Levels Despite Political Uncertainty
U.S. stock markets showed cautious movement on Thursday, July 17, 2025, as investors balanced strong earnings reports against ongoing tensions between the White House and Federal Reserve. The Dow Jones Industrial Average edged down 0.07% in early trading, while the S&P 500 gained a modest 0.07% and the Nasdaq Composite advanced 0.16%, continuing its record-setting performance.
Markets remain near historic peaks despite Wednesday’s volatility, which saw indexes drop sharply midday following reports that President Trump had drafted a letter to remove Fed Chair Jerome Powell, only to recover after Trump later denied immediate plans for Powell’s ouster.
“The market is underestimating the potential for a big U.S. earnings beat in the second quarter. Recent data on economic activity shows few signs of troubling weakness,” noted analysts at HSBC, suggesting that the current premarket movers might be setting the stage for stronger performance as more earnings reports roll in.
Economic Data Shows Resilient Consumer Spending
Thursday’s economic releases painted a picture of continued economic strength. Retail sales for June rose 0.6% from May, significantly beating economists’ expectations of a 0.2% increase. The 3.5% year-over-year growth indicates that consumer spending remains robust despite concerns about inflation and tariffs.
Additionally, weekly jobless claims fell to 221,000 for the week ending July 12, a decrease of 7,000 from the previous week’s revised level, suggesting the labor market continues to show resilience in the face of economic headwinds.
These positive economic indicators come as markets today weigh the impact of President Trump’s tariff policies, with an August 1 deadline looming that could bring higher levies for many U.S. trading partners. However, there are signs of progress, as Trump indicated the U.S. is closing in on a deal with India and may soon reach an agreement with Europe.
Tech Earnings Take Center Stage
The earnings season is gaining momentum with several major companies reporting results. Taiwan Semiconductor Manufacturing Company (TSM) shares jumped nearly 4% after reporting record quarterly profit and boosting its full-year revenue growth projection to around 30% on surging AI chip demand.
“Demand for artificial intelligence is getting stronger,” TSMC executives noted in their report, sending positive ripples through the semiconductor sector. U.S. chipmakers including Advanced Micro Devices (AMD), Marvell Technology (MRVL), and Nvidia (NVDA) all edged higher in premarket trading.
PepsiCo (PEP) shares rose 1.7% after the beverage and snack giant reported a surprise rise in revenue and improved its forecast for 2025 profit, citing resilient demand for its energy drinks and healthier soda brands like Poppi.
All eyes are now on Netflix (NFLX), which will report after the closing bell today. Analysts expect the streaming leader to report a 45% surge in quarterly net income, powered by a 16% jump in revenue, driven by popular content including Squid Game season three and Black Mirror season seven.
Notable Stock Movers
Beyond the major earnings reports, several stocks are making significant moves in today’s markets:
Rigetti Computing (RGTI) surged 30.19% in early trading, leading the list of top gainers alongside Joby Aviation (JOBY), which climbed 17.06%, and Summit Therapeutics (SMMT), up 16.05%.
United Airlines (UAL) fell 2.5% after the carrier flagged a hit to its third-quarter earnings due to operational challenges at Newark airport.
MP Materials (MP), a rare earths producer that has been a hot stock in recent months, dropped nearly 6% after announcing plans to raise $650 million in a stock offering. The move comes after Apple (AAPL) said it would invest $500 million in the company, which operates the only U.S. mine for rare earth materials used in batteries and other tech products.
Fed Independence Concerns Linger
Market sentiment continues to be influenced by the ongoing tension between President Trump and Federal Reserve Chair Jerome Powell. While Trump denied immediate plans to remove Powell, his continued criticism of the central bank’s reluctance to cut interest rates has raised concerns about Fed independence.
Several Fed officials are scheduled to speak on Thursday, including Fed Governor Adriana Kugler, San Francisco Fed President Mary Daly, Fed Governor Lisa Cook, and Fed Governor Christopher Waller. Their comments will be closely watched for any signals about the central bank’s stance on interest rates amid the political pressure.
Currently, traders see a 54.3% chance of a rate cut in September, while a July move is almost completely off the table, according to CME’s FedWatch tool.
Looking Ahead
As markets today process the latest earnings and economic data, investors remain focused on several key factors that could drive stock performance in the coming days and weeks.
The second-quarter earnings season is off to a strong start, with more than 45 S&P 500 components having reported thus far, and 87% of those exceeding analyst expectations, according to FactSet data.
Michael Green, strategist at Simplify Asset Management, noted, “Markets seem to have priced in Powell’s job insecurity. But the real catalyst now is earnings—especially from the tech giants.”
With major tech companies set to report in the coming weeks and ongoing developments in trade negotiations ahead of the August 1 tariff deadline, market volatility may continue as investors navigate this complex landscape of economic, corporate, and political factors.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.