Rising Stocks Refer to Post-Trump-Powell Fed Tour: Daily Stock Market Update
In the world of finance, the week of July 11 saw a series of significant developments.
On the stock market front, the S&P 500 added 0.4% to close at 6,388, marking a new weekly closing high. The Nasdaq Composite followed suit, rising 0.2% to 21,108, also setting a new weekly closing high. The Dow Jones Industrial Average closed at 44,901, up 0.5%. Technology was among the eight S&P 500 sectors that closed in the green on Friday.
Nvidia reached a new all-time intraday high, while Newegg, a leading global online retailer for PC hardware, consumer electronics, gaming peripherals, home appliances, automotive, and lifestyle technology, had a market capitalization of $598.2 million on July 24.
Materials and industrial stocks led to the upside, while energy and communication services stocks lagged. UnitedHealth Group was among the top 10 of the 30 Dow Jones stocks.
In the tech sector, Intel reported a loss of 10 cents per share on revenue of $12.9 billion for its second quarter. The company warned investors it might be forced out of the chip-making business if it doesn't attract more customers to support its next-generation manufacturing process. Cody Acree, Benchmark Research analyst, rates INTC stock a Hold but does not offer a 12-month target price. Intel forecast third-quarter revenue of $12.6 billion to $13.6 billion.
Meanwhile, in the realm of central banking, President Donald Trump cannot fire Federal Reserve Chair Jerome Powell directly. The action is legally difficult, unprecedented, and would raise serious concerns about the politicization of the Fed with potentially negative economic consequences. If Trump were to attempt to remove Powell, he would have to nominate a new Chair, who would then require Senate confirmation, a process that typically takes weeks or months. The implications for central bank independence would be severe, as the Federal Reserve is designed to operate independently to maintain economic stability and manage inflation without political pressure.
Lastly, there were rumours of potential mergers in the rail industry, with Union Pacific and Norfolk Southern reportedly in discussions, and Berkshire Hathaway possibly making a move for CSX via its BNSF Railway business. Vladimir Galkin, who made an investable fortune on GameStop and took a big position in JetBlue Airways, is also buying NEGG stock.
Warren Buffett and Greg Abel, his chosen successor to run Berkshire Hathaway's portfolio, appear to be at a crossroads with Kraft Heinz. The yield on the 10-year U.S. Treasury note was at 4.384%, while the 30-year yield was as high as 4.979% on Friday. The yield on the 2-year Treasury note ended the week at 3.917%.
As we move forward, these developments promise to shape the financial landscape in the coming weeks and months. Stay tuned for more updates!
- In the realm of decentralized finance (defi), the market cap of NEGG could potentially increase further due to the investment of Vladimir Galkin, who made a fortune on GameStop, as rumors suggest potential mergers in the rail industry may also contribute to overall market growth.
- Despite Intel's second-quarter loss and concerns about its chip-making business, the stock market’s tech sector continues to show strength, with the S&P 500, Nasdaq Composite, and Dow Jones Industrial Average all recording new weekly closing highs.
- As the Federal Reserve maintains its independent status, any attempt by President Trump to remove Jerome Powell as Chair would have severe implications for central bank independence, and potential negative economic consequences, highlighting the importance of maintaining financial stability without political pressure.
