Market Update: Stocks React to Tariffs and Earnings Reports
U.S. stock futures mostly held steady following President Donald Trump’s announcement of a new 50% tariff on copper imports and goods from Brazil, effective August 1. This news came as Nvidia and Microsoft garnered attention after both achieved record high stock prices the previous day. Delta Airlines saw a significant rise in stocks, spurred by better-than-expected earnings reports and optimistic full-year forecasts. Discussions have also intensified around the cereal maker WK Kellogg, particularly regarding potential acquisition talks with Italian chocolatier Ferrero.
Stock futures in the U.S. remained largely stable after Trump stated that a 50% tariff on both copper imports and Brazilian goods would start on August 1. The Nasdaq futures showed minimal movement, while tech-heavy indexes had closed at all-time highs the day before, fueled by gains from Nvidia and Microsoft. In contrast, the Dow Jones Industrial Average and S&P 500 futures reflected slight declines. Meanwhile, Bitcoin has retreated from its recent record highs, trading above $112,000, although it’s still the highest it’s been since May. Treasury bond yields remained relatively unchanged, while gold futures saw an uptick and oil futures decreased.
Trump’s new tariff targets both copper imports and shipments from Brazil, scheduled to start soon. A customs letter outlining the tariff changes has been shared on social media. According to Trump, the tariffs on copper were instituted after a national security review that highlighted the metal’s significance in semiconductor production, lithium-ion batteries, and missile defense systems.
Nvidia recently made headlines by achieving a market capitalization of $4 trillion on Wednesday, marking a milestone for the company. Its stock rose by 1.8%, reaching a remarkable high, while keeping its trajectory towards the “magic number” of $162.88. In the pre-market, Nvidia stocks were up by 0.7%. Microsoft also hit a new record yesterday, surpassing $500 for the first time, leading to a market capitalization of about $3.75 trillion. Currently, Microsoft stocks are lower ahead of market open.
Delta Airlines saw a notable 12% increase in pre-market trading after reporting quarterly results that exceeded analyst expectations, boosting the airline’s full-year outlook. The adjusted earnings per share reported was $2.10, aligning closely with the prior year but exceeding analyst projections from visible Alpha. Additionally, Delta has reinstated its full-year forecast, estimating adjusted earnings per share between $5.25 and $6.25, exceeding consensus expectations. CEO Ed Bastian noted that this renewed guidance is a testament to “our confidence in the business.”
In related news, shares of WK Kellogg jumped by 50% in pre-market trading following reports of potential acquisition talks with Ferrero, which could soon finalize a deal worth around $3 billion. WK Kellogg, known for its iconic cereal brands, was formed after Kellogg recently divided into WK Kellogg and Kellanova, the latter of which oversees snack brands like Pringles and Pop-Tarts.
