(July 11): US equities posted gains for a second consecutive week, even as investors digested the record US listing of South Korea’s SK Hynix Inc and renewed tensions in Iran ahead of second-quarter earnings.
The S&P 500 rose 0.4%, led by gains in materials and communication services. The Nasdaq 100 advanced 0.3%.
SK Hynix shares jumped 13% above their offer price after raising US$26.5 billion ($34.26 billion) in the largest-ever US initial share sale by a foreign company. The memory-chip maker sold 177.9 million American depositary receipts (ADRs) at US$149 each, with every ADR representing one-tenth of a Seoul-listed common share. SK Group chairman Chey Tae-won said he has an ambitious plan to invest more money in America, with a plan at a much bigger number than US$35 billion.
The market is approaching a potentially pivotal earnings season. Analysts have continued to lift forecasts ahead of second-quarter reports, with HSBC noting that S&P 500 profit estimates have risen to an expected 22% year-over-year increase — an unusual pattern this close to the reporting season and the strongest projected growth since the pandemic recovery.
Meanwhile, the S&P 500’s technology sector is sending a split signal. The index sits within a whisker of a record, yet more than half its members trade at least 20% below their own 52-week highs — a washed-out breadth reading normally seen near market lows, not peaks. A handful of mega-caps are masking a correction already unfolding beneath the surface.
US President Donald Trump said the US would continue talks with Iran but considers the ceasefire between the countries to be over. Meanwhile, the market absorbed another round of geopolitical uncertainty without violating key support levels, while the S&P 500 and Nasdaq 100 successfully reclaimed their 50-day moving averages and market participation continued to broaden beyond the mega-cap leaders, according to Craig Johnson, chief market technician at Piper Sandler & Co.
See also: Stocks fall as US-Iran jitters spur rally in oil
“We continue to see improving relative strength in Industrials, Financials, Healthcare, and SMID-cap stocks, suggesting this remains a rotational bull market rather than a narrow leadership rally,” Johnson said.
Tech stocks led gains this week after a bout of turbulence in semiconductor shares. JPMorgan Chase & Co’s trading desk noted that positioning in semiconductor and memory stocks had reached extreme levels, suggesting the upcoming earnings season will place greater emphasis on corporate guidance and strategic updates from hyperscale technology companies.
Among single stock movers, Meta Platforms Inc outperformed Magnificent 7 stocks on Friday after research firm SemiAnalysis posted a positive report on the social media giant’s AI compute business.
See also: Chip stocks sink after blistering run as oil jumps
Netflix Inc shares declined after the Wall Street Journal reported that the video-streaming company is considering steps to counter signs of declining subscriber engagement. EasyJet shares jumped 14% after the budget airline received a fresh bid from private equity firm Apollo that beats a rival proposal from Castlelake. The shares remain below both offer prices. Analysts believe there is scope for Castlelake to table a new rival bid.
Delta Air Lines Inc reaffirmed its full-year profit guidance, citing strong demand for premium, corporate and international travel that helped offset the highest quarterly fuel expense in its history.
Fermi Inc shares fell after the energy development firm priced an upsized offering of US$375 million in 5.00% convertible senior notes due 2031, with an option for initial purchasers to buy up to an additional US$56.25 million in notes.
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