US stocks push further into record heights
[July 01, 2025] By
STAN CHOE
NEW YORK (AP) — The U.S. stock market added to its record on Monday as
Wall Street closed out a second straight winning month.
The S&P 500 rose 0.5% in its first trading after completing a stunning
recovery from its springtime sell-off of roughly 20%. The Dow Jones
Industrial Average added 275 points, or 0.6%, and the Nasdaq composite
gained 0.5%.
Stocks got a boost after Canada said it’s rescinding a planned tax on
U.S. technology firms and resuming talks on trade with the United
States. On Friday, U.S. President Donald Trump had said he was
suspending talks with Canada because of his anger with the tax, which he
called “a direct and blatant attack on our country.”
One of the main reasons U.S. stocks came back so quickly from their
springtime swoon has been hope that Trump will reach deals with other
countries to lower his stiff proposed tariffs. Otherwise, the fear is
that trade wars could stifle the economy and send inflation higher.
Many of Trump’s announced tariffs are currently on pause, and they’re
scheduled to kick back into effect in a little more than a week.
The U.S. stock market being back at a record high could actually raise
the risk of renewed escalations on tariffs, according to strategists at
Deutsche Bank led by Parag Thatte and Binky Chadha. They point to the
pattern in 2018 and 2019 of rallies for the market prompting escalations
for tariffs, which then drove the market lower and led to subsequent
pullbacks on tariffs, which then sparked rallies again.
“Despite the rhetoric to the contrary, this dynamic looks alive and
well,” the strategists wrote in a report. “In our view, beyond the
market reaction, if negative impacts of tariffs on growth, earnings or
inflation start to materialize, we will get further relents.”
On Wall Street, Oracle’s 4% rise was one of the strongest forces lifting
the S&P 500. CEO Safra Catz said the tech giant “is off to a strong
start” in its fiscal year and that it signed multiple large cloud
services agreements, including one that could contribute over $30
billion in annual revenue two fiscal years from now.
GMS’ stock jumped 11.7% after the supplier of specialty building
products said it agreed to sell itself to a Home Depot subsidiary in a
deal that would pay $110.00 per share in cash. That would give it a
total value of roughly $5.5 billion, including debt.
Less than two weeks ago, another company, QXO, said it was offering to
buy GMS for $95.20 per share in cash. After the announcement of the Home
Depot bid, QXO’s stock rose 3.9%, and Home Depot’s stock slipped 0.6%.
Hewlett Packard Enterprise rallied 11.1% and Juniper Networks climbed
8.4% after saying they had reached an agreement with the U.S. Department
of Justice that could clear the way for their merger go through, subject
to court approval. HPE is trying to buy Juniper in a $14 billion deal.
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Trader Edward Curran works on the floor of the New York Stock
Exchange, Friday, June 27, 2025. (AP Photo/Richard Drew)
 Bank stocks were also solid after
the Federal Reserve said on Friday that they are financially strong
enough to survive a downturn in the economy. JPMorgan Chase climbed
1%, and Citigroup gained 0.9%.
All told, the S&P 500 rose 31.88 points to 6,204.95. The Dow Jones
Industrial Average added 275.50 to 44,094.77, and the Nasdaq
composite gained 96.27 to 20,369.73.
In the bond market, Treasury yields fell ahead of several major
economic reports later in the week. The highlight will be Thursday’s
jobs report. It’s often the most anticipated economic data of each
month, and it will come a day earlier than usual because of Friday's
Fourth of July holiday.
The job market has remained relatively steady recently, even in the
face of tariffs, but hiring has slowed. Economists expect Thursday’s
data to show another step down in overall hiring, down to 115,000
jobs in June from 139,000 in May.
Such data has helped keep the Federal Reserve on hold this year when
it comes to interest rates. Fed Chair Jerome Powell has said
repeatedly that it’s waiting for more data to show how tariffs will
affect the economy and inflation before resuming its cuts to
interest rates. That’s because lower rates can fan inflation higher,
along with giving the economy a boost.
Trump, meanwhile, has been pushing for more cuts to rates and for
them to happen soon. Two of his appointees to the Fed have said
recently they could consider cutting rates as soon as the Fed’s next
meeting in less than a month.
The yield on the 10-year Treasury fell to 4.23% from 4.29% late
Friday.
In stock markets abroad, indexes dipped modestly in Europe following
a more mixed finish in Asia.
Stocks fell 0.9% in Hong Kong but rose 0.6% in Shanghai after China
reported its factory activity improved slightly in June after
Beijing and Washington agreed in May to postpone imposing higher
tariffs on each others’ exports, though manufacturing remained in
contraction.
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AP Business Writer Elaine Kurtenbach contributed.
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