U.S. Stock Market Recap – July 15, 2025 & What to Watch on July 16
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📊 Markets Recap: Tuesday, July 15 – Inflation Surprises, Nasdaq Soars
A hotter-than-expected inflation report tested the resilience of equity markets Tuesday, but risk appetite held firm in tech-heavy areas. While the S&P and Dow pulled back, the Nasdaq hit a fresh all-time high—fueled by AI momentum and megacap strength—despite fading rate-cut hopes.
Major Indexes (Approx. Close):
S&P 500: –0.4% to 6,243.8
Dow Jones: –1.0% to 44,023
Nasdaq Composite: +0.2% to 20,677.8 (record close)
Russell 2000: –2.0% to 2,205
TL;DR
June CPI came in hot: +0.3% MoM, 2.7% YoY; Core inflation rose 2.9%.
Nasdaq closed at a new record, lifted by Nvidia and AI leadership.
Small caps fell hard, with the Russell 2000 dropping 2% on rate and growth concerns.
Big banks beat earnings expectations, led by JPMorgan’s strong trading and NII forecast.
Rate cut bets faded, with bond yields ticking higher across the curve.
🔧 Key Drivers
1. Hotter CPI Print
June’s Consumer Price Index surprised to the upside, with headline inflation rising 0.3% month-over-month and 2.7% year-over-year. Core CPI, which strips out food and energy, increased 0.2% on the month and 2.9% annually.
While not catastrophic, the print was sticky enough to cool expectations of a September rate cut. Treasuries sold off modestly, with the 2-year yield rising several basis points.
2. Banks Post Solid Earnings
JPMorgan, Citi, and Wells Fargo all reported stronger-than-expected results. JPMorgan stood out, posting $14.2 billion in profit and raising its full-year net interest income (NII) forecast to $95.5 billion. Trading revenues and investment banking also exceeded estimates.
CEO Jamie Dimon struck a cautious tone, highlighting geopolitical risk, tariff uncertainty, and consumer credit trends.
3. Tech and AI Keep Climbing
Despite inflation pressures, big tech and AI-linked names powered the Nasdaq to yet another all-time high. Nvidia continued to lead the pack, with strength also seen in cloud, semiconductors, and enterprise AI infrastructure plays.
With chip export restrictions looming, traders leaned into domestic AI beneficiaries and resilient tech earnings potential.
4. Rate-Sensitive Names Hit
The sharp drop in the Russell 2000 reflects renewed pressure on small-caps and cyclical names. Rate-sensitive sectors like regional banks, REITs, and housing stocks saw outsized declines. Industrials also lagged on growth concerns and trade policy anxiety.
📅 What to Watch – Wednesday, July 16
1. Powell Testifies Before Congress
Fed Chair Jerome Powell delivers his semiannual testimony to Congress. After Tuesday’s CPI surprise, markets will be listening for any signal around how much runway remains for cuts this year. Any hawkish shift could dent recent equity momentum.
2. More Bank Earnings
Bank of America and Goldman Sachs report before the bell. Areas to watch: loan growth, credit trends, investment banking performance, and forward guidance on NII. With JPMorgan setting the tone, the bar has moved higher.
3. Chip & AI Headlines
Semis remain the heartbeat of this market. Any further updates on chip export controls or enterprise AI demand could ripple through the sector. Watch AMD, Broadcom, and cloud providers for sympathy moves.
4. Treasury Auction & Yield Watch
A 10-Year Treasury auction in the afternoon may test bond demand after the CPI print. Weak uptake or rising yields could put more pressure on rate-sensitive equities and alter Fed expectations.
📈 Sector Snapshots
Tech & AI: Nasdaq leadership intact. Nvidia remains the bellwether. Software, cloud, and semis showing strength.
Financials: Banks beat, but forward guidance and Powell’s tone will drive the next move.
Small-Caps: Under pressure. Russell dropped 2% as growth and rate jitters returned.
Energy & Commodities: Crude held steady; metals mixed. No tariff fallout—yet.
Crypto & Speculative Tech: Cooled slightly after Monday’s run, but sentiment still constructive.
🧭 Final Thoughts
Despite the CPI surprise, equity markets held up well—at least in tech. The Nasdaq’s resilience underscores how concentrated this rally has become. But beneath the surface, there are cracks: small-caps and cyclicals are retreating, and Treasury yields are rising again.
The next 48 hours will be pivotal. Powell’s testimony and bank earnings could either reinforce the soft landing narrative—or introduce new doubt. With mega-cap earnings around the corner, the bulls are running on momentum—but also on borrowed time.
Stay nimble.