Profit Insights

## U.S. Equity Markets Snap Record Highs
On Thursday, July 10, 2025, U.S. equity markets extended their summer rally, with the S&P 500 and Nasdaq Composite closing at all-time highs for the second consecutive session. The S&P 500 rose 0.27% to 6,280.46, while the Nasdaq edged up 0.09% to 20,630.66. The Dow Jones Industrial Average added 192.34 points, or 0.43%, finishing at 44,650.64. Small caps outperformed as the Russell 2000 advanced 0.5% to 2,263.41. Market breadth was positive, with advancers beating decliners by roughly 2-to-1 on both the NYSE and Nasdaq. Investors shrugged off fresh trade tensions, focusing instead on solid corporate earnings and favorable central bank signals that underpin risk assets.

## Sector Movers Drive Upside
Strong performances in the airline and consumer sectors powered Thursday’s gains. Delta Air Lines surged 12% after raising its full-year outlook, while United Airlines jumped 14.3%. Consumer names also shone: WK Kellogg soared over 30% following news of a $3.1 billion buyout by Ferrero, and Estée Lauder climbed 6.3% on bullish analyst commentary. Technology stocks broadly participated, buoyed by Nvidia’s brief $4 trillion valuation milestone, which lifted chip and semiconductor peers. Conversely, a handful of laggards—including Autodesk, PTC, and Axon Enterprise—pulled back after recent rallies, providing profit-taking opportunities. Across sectors, banks and consumer-focused companies joined the rally, with JPMorgan and McDonald’s each gaining around 1.8%.

## Labor Market Signals Strength
Economic data released Wednesday also underpinned investor confidence. Initial U.S. jobless claims unexpectedly fell by 5,000 in the week ending July 5 to a seven-week low of 227,000, compared with economists’ forecasts of 235,000. Continuing claims, representing those receiving benefits beyond the first week, rose 10,000 to 1.965 million—its highest since November 2021—hinting at longer job searches but still reflecting a resilient labor market. The unemployment rate ticked down to 4.1% in June, driven partly by a slight contraction in the labor force. Federal Reserve minutes from the June policy meeting revealed a growing expectation among officials for potential rate cuts later this year, reinforcing hopes of looser financial conditions.

## Trade Policy and Tariffs
Despite the upbeat tone on Wall Street, trade policy developments added a layer of uncertainty. President Trump announced a 50% tariff on copper imports effective August 1, followed by a similar levy on selected Brazilian goods in response to what he termed “very unfair” trade practices. Copper prices paradoxically rose 1.9% on the tariff news, reflecting tight supply dynamics and hedging demand, while the Brazilian real weakened. Equity markets in Asia and Europe showed muted reactions, suggesting investors have grown accustomed to headline-grabbing trade moves and are focusing more on fundamentals and corporate earnings. Treasury yields ticked higher, with the 10-year yield holding around 4.34%, as rate-cut expectations were tempered by persistent inflationary concerns tied to tariffs.

## Commodities: Crypto and Oil
Cryptocurrency markets participated in the risk-on sentiment, with Bitcoin briefly surging past $113,000 as trading volume surged on new exchange-traded funds and supportive policy talk out of Washington. Ethereum and other major tokens also posted gains, underscoring the growing institutional embrace of digital assets. In energy markets, oil prices edged up on Friday, July 11, as investors weighed potential U.S. sanctions on Russia alongside mixed signals from OPEC+. Brent crude rose 0.28% to $68.83 a barrel and West Texas Intermediate gained 0.36% to $66.81, despite an OPEC+ agreement to raise output by 548,000 barrels per day in August. Seasonal demand and geopolitical risks in the Red Sea supported the market, offsetting concerns about rising U.S. stockpiles and trade-related headwinds.

## Corporate Earnings Spotlight
Delta Air Lines led Thursday’s corporate news flow with a better-than-expected second-quarter report. Adjusted earnings came in at $2.10 per share, slightly ahead of analyst forecasts, on revenues of $16.65 billion. Delta reinstated its full-year 2025 guidance to a range of $5.25–$6.25 per share, citing stabilized bookings, disciplined capacity management, and strong loyalty-revenue performance. The company’s focus on cost controls is expected to keep non-fuel operating expenses flat or lower in the third quarter. Delta’s upbeat outlook lifted its stock by roughly 13% in premarket trading, with other carriers such as United and Southwest also climbing on the sector’s improved prospects.

## M&A: Ferrero’s WK Kellogg Deal
In merger news, Italy’s Ferrero Group struck a definitive agreement to acquire WK Kellogg for $23.00 per share in cash—a total enterprise value of approximately $3.1 billion. The deal represents a 40% premium over the 30-day volume-weighted average price and includes WK Kellogg’s six North American cereal plants and distribution network. Ferrero aims to diversify beyond confectionery into breakfast foods, leveraging iconic brands like Froot Loops and Rice Krispies. WK Kellogg shares responded with a premarket surge of over 50%, briefly hitting $26.87 before the open. The transaction, expected to close in the second half of 2025 subject to shareholder approval, underscores the favorable antitrust environment under the current U.S. administration.