Key Takeaways
- Alphabet (GOOGL) surged in pre-market trading after reporting beats on EPS, revenue, and cloud revenue, alongside significantly raised capital expenditure guidance for the fiscal year. Conversely, Tesla (TSLA) shares dropped following CEO Elon Musk's warning of "a few rough quarters" amid reduced government support for EV manufacturers.
- A Financial Times (FT) report indicates that Nvidia (NVDA) AI chips worth $1 billion have been smuggled into China despite U.S. export controls, highlighting ongoing challenges in enforcing technology restrictions.
- Blackstone (BX) delivered a strong second quarter, with distributable income per share of $1.21 exceeding estimates of $1.10, and total assets under management (AUM) reaching a record $1.21 trillion.
- The Turkish Central Bank surprised markets with a larger-than-expected interest rate cut of 300 basis points, bringing the one-week repo rate to 43.00% from 46.00%.
- American Airlines (AAL) reported stronger-than-expected Q2 adjusted EPS of $0.95 against an estimate of $0.75, and passenger revenue of $13.12 billion, but its shares declined in pre-market trading due to weak Q3 and full-year guidance.
Major companies are reporting their second-quarter earnings, driving significant pre-market movements and offering insights into various sectors. Meanwhile, geopolitical tensions and central bank actions continue to shape the global economic landscape.
Search giant Alphabet (GOOGL) experienced a positive pre-market reaction, climbing 3% after its Q2 earnings, revenue, and cloud revenue all surpassed analyst expectations. The company also provided a fiscal year capital expenditure guidance that was notably higher than previous estimates, signaling aggressive investment. Deutsche Bank raised its target price for Alphabet to $215 from $200, further bolstering investor confidence.
In contrast, Tesla (TSLA) saw its shares fall 6% in pre-market trading. This decline followed CEO Elon Musk's cautionary remarks about "a few rough quarters" ahead, attributed to a reduction in government support for electric vehicle manufacturers.
A significant development in the technology sector involves Nvidia (NVDA). The Financial Times reported that $1 billion worth of Nvidia's advanced AI chips have been smuggled into China, circumventing U.S. export controls. This highlights the persistent demand for high-end AI hardware in China despite international restrictions.
In the financial sector, Blackstone (BX) announced robust Q2 2025 earnings, with distributable income per share of $1.21, exceeding the estimated $1.10. The alternative asset manager's total assets under management (AUM) grew to a record $1.21 trillion, surpassing estimates of $1.19 trillion, driven by strong inflows of $52.08 billion. The firm also declared a quarterly dividend of $1.03 per share.
American Airlines (AAL) reported an adjusted EPS of $0.95 for Q2 2025, beating the estimated $0.75. Passenger revenue also slightly exceeded expectations at $13.12 billion. However, the airline's pre-market shares dropped 5% as it projected a Q3 adjusted loss per share between $0.10 and $0.60 and reinstated full-year guidance with an adjusted loss per share ranging from $0.20 to an EPS of $0.80, which was below some analyst estimates.
Other notable earnings include Keurig Dr Pepper (KDP), which reported Q2 adjusted EPS of $0.49 (vs. est. $0.48) and net sales of $4.2 billion (vs. est. $4.13 billion), driven by a strong 5% volume/mix increase. NASDAQ (NDAQ) also surpassed revenue estimates, reporting $1,306 million against an estimated $1,276 million for Q2. IBM (IBM) saw its shares decline 5.5% pre-market after its software revenue came in light.
In central bank news, the Turkish Central Bank implemented a larger-than-anticipated interest rate cut, reducing its one-week repo rate by 300 basis points to 43.00%. This move exceeded the market's expectation of a 250 basis point cut. The European Central Bank (ECB) is also in focus, with LiveSquawk hosting a preview show ahead of its upcoming rate decision.
On the geopolitical front, Iran's Deputy Foreign Minister stated that trust-building, recognition of Tehran's nuclear rights, and guarantees not to attack Iran are necessary to resume nuclear talks with the U.S., according to Mehr News. Additionally, Japanese Prime Minister Ishiba reaffirmed commitment to implementing trade deals and assuring business confidence. U.S. President Donald Trump's schedule indicates a visit to the Federal Reserve, a move that could intensify pressure on the independent central bank regarding interest rates.
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.