US Stocks Climb as Investors Brace for Week of Big Tech Earnings

(Bloomberg) — US stocks rose to fresh records on Friday, as investors braced for earnings from some of Wall Street’s biggest technology companies in the coming week.

The S&P 500 Index rose 0.4% to notch its fifth-straight all-time high and its fourth week of gains in the last five. The tech-heavy Nasdaq 100 Index rose 0.2%, also closing at a record. Bloomberg’s gauge for the so-called Magnificent Seven megacap tech names finished the session 0.5% higher, falling short of its first record close since December.

Robust corporate earnings have bolstered investor confidence in US stocks, as companies head for their highest share of beats since the second quarter of 2021. Traders will be watching next week’s results from Magnificent Seven members Apple Inc., Amazon.com Inc., Microsoft Corp. and Meta Platforms Inc. for evidence that the massive companies can justify their often-lofty valuations.

“AI spending, cloud demand and digital advertising are among the key themes for earnings season for the big tech names that underpin the market’s recent run of all-time highs,” said Saxo Bank’s Neil Wilson. “Given the concentration in the Mag 7, these numbers are going to be crucial for the market as a whole.”

The S&P 500 gained 1.5% for the week, while the Nasdaq 100 added 0.9%.

Friday’s notable movers included Deckers Outdoor Corp., whose shares rose after sales for Ugg boots and Hoka running shoes surpassed analyst estimates. Intel Corp. slumped on concerns that executive officer Lip-Bu Tan is prioritizing cost-cutting over restoring the company’s technological edge.

Charter Communications Inc. had its worst day on record after the company said it lost more internet customers than expected in the second quarter. Newmont Corp., the world’s top gold miner, jumped after beating earnings expectations.

Tariff Focus

Traders are also tracking developments on the trade front, as President Donald Trump continues to negotiate with US trading partners on tariffs. Before departing on a golf trip to Scotland, Trump put the odds of striking an agreement with the European Union to reduce the tariff rate on their imports at 50-50.

Trump earlier this month issued a letter saying the EU would face a 30% tariff on most goods if they fail to reach an agreement by Aug. 1, in addition to sector-specific tariffs.

“A deal with the EU is necessary for the equity rally to continue, in our view, but would not be a surprise,” said Paul Christopher, head of global investment strategy at Wells Fargo Investment Institute. “The only surprise would be no deal by August 1.”

Meanwhile, Bank of America Corp. strategists led by Michael Hartnett warned the risk of a bubble in stock markets is rising as monetary policy loosens alongside an easing in financial regulation. His comments came following a resurgence in investors’ appetite for meme stocks, which has sparked dramatic rallies in shares of companies such as Kohl’s Corp., GoPro Inc. and Krispy Kreme Inc.

“Bigger retail, bigger liquidity, bigger volatility, bigger bubble,” Hartnett wrote in a note.

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