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Market Recap
WEEK OF AUG. 4 THROUGH AUG. 8, 2025
The S&P 500 index rose 2.4% last week, led by technology and consumer discretionary stocks amid better-than-expected earnings and growing expectations for the Federal Reserve to cut rates in September. The S&P 500 ended Friday's session at 6,389.45, bringing quarter-to-date gains to 3% and year-to-date growth to 8.6%.
Following the previous week's weaker-than-expected non-farm payrolls report, data last week continued to come in below estimates.
The Institute for Supply Management's U.S. services index fell to 50.1 in July from 50.8 in June, compared with the 51.5 expected in a Bloomberg-compiled survey. The 49.9 ISM print in May was the first sub-50 reading since June 2024 and only the fifth in the 62 months since the pandemic recovery began in June 2020, according to a note from Jefferies. A reading below 50 denotes contraction.
Initial jobless claims rose to 226,000 in the week ended Aug. 2, up from an upwardly revised 219,000 in the previous week, compared with expectations for 222,000 in a Bloomberg survey.
The odds of a 25-basis-point rate cut by the Federal Reserve in September surged to 89% as of late Friday, from 80% a week ago and 61% a month earlier, according to the CME FedWatch tool.
The technology sector had the largest percentage gain last week, up 4.3%, followed by a 3.8% increase in the consumer discretionary sector. Three sectors fell, with energy down 1%, healthcare 0.8% lower, and real estate in a 0.1% retreat.
Earnings helped fuel the rally in the information technology sector, with Palantir Technologies ( PLTR ) surging more than 21% this week after Q2 results topped estimates as sales in the US increased.
Apple ( AAPL ) shares jumped over 13% for the week as the company announced plans to invest an additional $100 billion in the US and bring more of its supply chain and advanced manufacturing to the country. That commitment, along with the launch of Apple's American Manufacturing Program, suggests that several of its products may be exempt from looming tariffs, BofA Securities said in a report.
Tesla (TSLA), also an index heavyweight along with Apple, was the second-biggest gainer in consumer discretionary. The company awarded CEO Elon Musk 96 million new shares, it said in a filing. The shares will only vest if Musk stays in a top executive role through 2027 and come with a five-year holding period, except for taxes or purchase costs. Shares of the electric vehicle manufacturer jumped 8.9% this week.
Decliners included shares of Eli Lilly and Company ( LLY ) , which fell almost 18% this week in the healthcare sector. Though Eli Lilly raised its full-year outlook and reported stronger-than-expected second-quarter results, its shares were still sold off as data from its investigational weight-loss pill disappointed investors.
This week's earnings calendar is pretty light but features Cisco Systems ( CSCO ) , Applied Materials ( AMAT ) and Deere (DE).
Economic data due this week comprises July's consumer and producer price indexes as well as retail sales, among others. The University of Michigan will also release a preliminary reading of August consumer sentiment.
