Gold prices edge lower; heading for weekly losses ahead of U.S.-Russia talks
Investing.com -- U.S. stocks closed higher on Thursday ahead of the Independence Day holiday, with the S&P 500 and Nasdaq Composite setting new record highs.
A stronger-than-expected June jobs report boosted confidence in the resilience of the U.S. economy, despite ongoing uncertainty around trade and geopolitics.
The Dow Jones Industrial Average rose 344 points, or 0.77%, to close at 44,828.53. The S&P 500 gained 0.83% to 6,279.35, while the Nasdaq advanced 1.02% to finish at 20,601.10. Both the S&P and Nasdaq ended at all-time highs.
Nonfarm payrolls increased by 147,000 in June, exceeding expectations and edging above May’s revised figure. The unemployment rate unexpectedly dipped to 4.1%.
The upbeat labor data led to higher Treasury yields and tempered expectations for a near-term rate cut from the Federal Reserve. Markets are now overwhelmingly pricing in no change at the Fed’s upcoming meeting.
For the week, all three major indexes posted gains, with the Dow up 2.3%, the S&P 500 up 1.7%, and the Nasdaq rising 1.6%.
Tariff deadline in focus as trade talks intensify
This week, investors will be closely watching trade developments out of Washington, with a key tariff suspension deadline approaching next Wednesday. If no new tensions emerge, markets could respond positively.
More than a dozen major U.S. trading partners are racing to finalize agreements with President Donald Trump’s administration before July 9 to avoid higher tariffs.
While progress has been made with Vietnam—Trump announced a deal that will impose a lower-than-expected 20% tariff—negotiations with Japan have reportedly stalled.
Talks with India are ongoing, with a potential agreement still on the table.
Markets have rebounded in recent weeks as investors shifted from tariff fears to optimism, buoyed by resilient corporate earnings and a solid economic backdrop. Analysts suggest that avoiding a major flare-up next week would remove one near-term risk.
"I think that there may be some threats and saber-rattling, but I don’t really think that any of that now poses a major danger to the market," said Irene Tunkel, chief U.S. equities strategist at BCA Research.
Beyond trade, investors will also be monitoring inflation data and corporate earnings over the coming weeks for signals on the U.S. economy and the Fed’s next move on interest rates.
What analysts are saying about U.S. stocks
BTIG: "SPX into fresh all-time highs, and as such no natural levels of resistance. Daily RSI is getting extended at 75, but note that overbought in an uptrend is often not an imminent sell signal as RSI got to 82 last July before a final high. If we do see a near-term shakeout, 5975-6k should be decent support. We think mid-July as EPS season approaches could be a spot for a bigger pullback heading into August."
Capital Economics: "We aren’t minded to revise up our recently eclipsed end-2025 forecast for the S&P 500 of 6,250. That’s because there are some lingering risks, including what tack the U.S. administration takes on tariffs next week and the upcoming earnings season, which may shed light on how tariffs are affecting companies’ profits. We are, however, sticking to our view the index will rise to 7,000 by end-2026. For all that, we are more concerned about the S&P 500’s longer-term prospects, as we continue to think that enthusiasm for AI will wane at some point."
JPMorgan: "We have been OW Growth vs Value style and OW large vs small caps for years, but have in summer ‘24 advised to neutralize Growth OW, given stretched positioning, price relatives and valuations at highs, extreme retail ownership and elevated expectations. Tech fundamentals are staying strong, but AI trade should be broadening. Historically, winners from the technological disruption would not be the incumbents, they were the outsiders. Within Tech, we called last July for the rotation out of previously strongly performing Hardware and Semis and into Software (ETR:SOWGn), and reiterate this."
Evercore ISI: "Of the 6 prior Non-Recession Bear markets since 1960, stocks averaged a further +26% over 18 months after new highs. But a rally does not preclude volatility – drawdowns ranged from -7.5% to -15.1% before a “final peak”. And at 24.5x EPS with Tariff Day July 9 ahead, stocks are at a crossroads – Structural AI Bull Market vs. trading peak catalyzed by upward pressure on global yields even as the labor market changes, Tariffs reappear, and with 7/2024-like Factor Rotation. EVR ISI Strategy maintains core longs in AI leaders in O/P sectors Comm. Svcs., Cons. Disc., and Info. Tech., augmented by a tilt toward Low Valuation/Strong Revision Stocks."
Wolfe Research: "We continue to remain modestly below consensus for 2026E S&P 500 Operating EPS at $295. Assuming the current NTM P/E multiple of 22x holds, we’d expect fair value for the S&P 500 index level at ~6,500 at year end, representing +3% upside from last Thursday’s close."