USA market summary Jul 23, 2024

Markets took a breather on Tuesday after recent swings, with investors split between the evolving political situation and corporate earnings. Here are the key takeaways:

Key Takeaways:

• Calm after the storm: Stocks closed slightly lower after a choppy session as investors digested earnings reports and braced for mega-cap results from Alphabet and Tesla.

• Changing of the guard? Small-cap stocks continued their recent tear, outperforming the broader market, suggesting a potential leadership shift towards more cyclical sectors.

• Earnings season underway: Second-quarter earnings have gotten off to a broadly strong start, though UPS missed expectations. Results from tech giants Alphabet and Tesla will be key in setting market direction.

• Housing cools further: Existing home sales fell for the fourth consecutive month, indicating continued weakness in the housing market.

Notable Movers:

• General Motors (GM): Fell short of profit estimates.

• UPS (UPS): Declined after missing earnings expectations, despite shipment volume growth.

• Alphabet (GOOGL): Results expected after the bell.

• Tesla (TSLA): Results expected after the bell.

The Bottom Line: The rotation towards cyclical and small-cap sectors suggests that investors are betting on an economic rebound and interest rate cuts. However, upcoming results from tech giants will be crucial in confirming this trend.