Dow Jones futures rose modestly early Monday, along with S&P 500 futures and Nasdaq futures. The U.S. and European Union reached a trade deal Sunday while a China trade truce reportedly will be extended. Huge earnings and a Fed meeting loom this week.
The stock market rally continued to advance last week, with the S&P 500 and Nasdaq composite hitting fresh highs.
Microsoft, Meta Platforms, Amazon.com and Apple headline a mammoth week of earnings. Microsoft, Meta and Amazon comments on artificial intelligence monetization and capital spending will likely have a huge impact on the broader AI sector, following results from fellow hyperscaler and Google-parent Alphabet. Meta stock could be actionable after results.
Meanwhile, the Federal Reserve is expected to stand pat on rates again on Wednesday, but will Fed chief Jerome Powell hint at upcoming moves?
Tesla appears ready to expand a ride-hailing service to San Francisco, but the "robotaxi" would have human safety drivers behind the wheel.
Dow Jones Futures Today
Dow Jones futures rose 0.4% vs. fair value. S&P 500 futures advanced 0.5% and Nasdaq 100 futures climbed 0.6%.
Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.
Trump-EU Trade Deal, China Trade Truce
President Donald Trump announced a trade deal with the European Union on Sunday after meeting with European Commission President Ursula von der Leyen in Scotland. The U.S. will impose a 15% tariff on most European goods, including autos. Tariffs on the EU had been 10%, but 25% tariffs on key goods such as autos. Trump had threatened 30% tariffs on the EU in May.
Trump said the EU will buy a lot of U.S. energy and military gear. Trump has made similar claims following other trade deals, with the other countries disputing some specifics.
Notably, Trump and von der Leyen disagreed on what pharmaceutical tariffs, which had been exempt from Trump duties so far, would be.
Meanwhile, the U.S. and China will extend a trade truce for another 90 days at this week's talks in Stockholm, the South China Morning Post reported Sunday.
President Trump has set an Aug. 1 deadline for new big tariff hikes on countries without a trade deal. That's also the same day as the July employment report.
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Stock Market Rally
The stock market rally had a number of mixed sessions, but the major indexes all rose for the week. The S&P 500 and Nasdaq hit fresh all-time highs, with the Dow Jones close.
The Dow Jones Industrial Average gained 1.3% in last week's stock market trading. The S&P 500 index popped 1.5%. The Nasdaq composite rose 1%. The small-cap Russell 2000 also advanced 1%, hitting a five-month high on Wednesday.
Leading stocks generally acted well, with Google capital spending plans and various earnings reports lifting AI-related names. Microsoft, Meta and Amazon earnings — along with results from chip plays Arm Holdings and KLA Corp. well as data-center infrastructure plays such as Vertiv — will be AI drivers this coming week.
A wide variety of sectors are acting well, including aerospace and financials.
In addition to Meta stock, ARM, KLA, Spotify, Booking Holding, Exelixis and Visa all could be actionable following earnings.
The 10-year Treasury yield fell five basis points to 4.385%, within a recent range.
U.S. crude oil futures fell 1.35% to $65.16 a barrel for the week.
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ETFs
Among growth ETFs, the Innovator IBD 50 ETF gained 0.7% last week. The iShares Expanded Tech-Software Sector ETF climbed 1.4%, with Microsoft stock a major holding. The VanEck Vectors Semiconductor ETF fell 1%, with KLAC stock in the ETF. ARK Innovation fell 1.1% last week and ARK Genomics popped 4.3%. Tesla stock is the No. 1 holding across ARK Invest's ETFs.
The SPDR S&P Metals & Mining ETF rallied 3.2%, a 16th straight weekly gain. SPDR S&P Homebuilders jumped 5%. The Energy Select SPDR ETF advanced 1.3%, and the Health Care Select Sector SPDR Fund bounced 3.5%. The Industrial Select Sector SPDR Fund rose 2.3%. The Financial Select SPDR ETF was up 1.7%.
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Tesla Robotaxi In San Francisco
The Tesla robotaxi app now includes California as an option, though it's not clear if any rides have taken place. That follows a Business Insider report that Tesla was set to launch a robotaxi service to the San Francisco Bay Area as soon as the weekend.
But the Tesla app confirms reports that the robotaxis will have a safety driver behind the wheel, so it's Supervised Full Self-Driving, like Tesla FSD owners have.
That's a step down from the Austin, Texas, robotaxi operation, with safety monitors in the passenger seat ready to intervene but not actually drive.
Tesla has a California permit for ride-hailing but not any permits for self-driving.
Meanwhile, Samsung is making Tesla's Dojo AI chips in a multi-year $16.5 billion deal that started in July 2024.
Tesla stock fell 4.1% to 316.06 last week. Shares tumbled 8.2% on Thursday, below key moving averages, after weak earnings and CEO Elon Musk warning of a "a few rough quarters" ahead. But shares rose 3.5% on Friday amid the San Francisco "robotaxi" report.
Google's Waymo operates robotaxis without any human driver or monitor in several metro areas, including Austin and much of the San Francisco Bay Area.
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What To Do Now
The stock market continues to advance, hitting new highs.
Investors should be heavily invested. They might consider taking some profits, especially for holdings with earnings on tap, but letting winners run is a sound strategy.
Setups are somewhat scarce, with several of those due to report this week, including Meta, ARM and Booking. Definitely have your watchlists ready. The next week or two could offer a number of buying opportunities. Be choosy.
Even if you end up taking no action, it's important to be engaged with a game plan for such a busy week.
The Federal Reserve will conclude a two-day policy meeting on Wednesday afternoon. Microsoft and Meta will report Wednesday evening, with Apple and Amazon stock due Thursday night. The July jobs report will wrap the week, along with a possible Trump tariffs deadline.
Microsoft stock and KLA are on IBD Long-Term Leaders. KLA stock is on the IBD 50.
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