Markets retreat from record highs
US stocks pulled back on Thursday as broader market weakness offset stellar earnings from Microsoft and Meta Platforms. The S&P 500 slipped 0.37% to 6,339.39, marking its third straight loss. The Dow Jones fell 330 points, or 0.74%, to 44,130.98, while the Nasdaq edged down just 0.03% to 21,122.45. All three indexes touched intraday highs before reversing course.
Microsoft and Meta led the gains after delivering better-than-expected quarterly results. Meta jumped 11% and lifted its market cap to US$1.95 trillion on strong third-quarter sales guidance. Microsoft added 4%, with Azure revenue surpassing US$75bn annually. The tech giant briefly became the second US-listed company to top a US$4 trillion valuation.
Despite the tech rally, nine of the 11 S&P sectors closed lower. UnitedHealth and Merck dragged on the Dow, losing 6% and 4%, respectively.
Rate path and trade tensions weigh on sentiment
Market optimism was checked by lingering doubts over the Federal Reserve’s next move. While rates were left unchanged at this week’s meeting, investors grew less confident about a September cut. Sentiment was also hit by an approaching White House deadline to hike tariffs on key trading partners.
President Trump extended a 25% tariff on Mexican imports for 90 days but threatened new measures against Canada after it floated support for Palestinian statehood. The administration also sent letters to major pharmaceutical companies, including Merck and Pfizer, demanding the US receive the lowest global drug prices.
Meanwhile, Treasury Secretary Scott Bessent said negotiations with China were progressing, but gave no timeline. The current tariff truce with Beijing expires August 12.
Markets wrap up a strong July
Thursday’s pullback capped an otherwise upbeat month. The S&P 500 rose 2.2% in July, with the Nasdaq gaining 3.7% and the Dow inching up 0.1%, marking the third straight positive month for all three.
ASX set to open lower
Australian shares are expected to open weaker, with futures down 64 points or 0.7% to 8639. The local session will be shaped by fresh trade headlines and Friday’s upcoming US jobs report.
In commodities, iron ore slid 2% to US$99.70 a tonne, and Brent crude fell 1% to US$72.53 a barrel. Gold edged up 0.5%, while the Aussie dollar traded at US64.26¢.
On the local data docket: July dwelling prices and Q2 producer inflation. Resmed leads Friday’s earnings calendar.
