Closing Recap

U.S. stocks continued their record-setting pace, with the S&P 500 and Nasdaq notching new all-time highs as a “buy the dip” mentality and rising hopes for Fed rate cuts propelled the market higher; small caps and the Dow also surged, while gold gained, oil fell, and Treasury yields declined. 

Key Takeaways 

• New Record Highs: The S&P 500 and Nasdaq Composite closed at new records, continuing a powerful multi-month rally. Small caps and the Dow also saw significant outperformance. 
• Broad Rally, Tech Lags Slightly: Gains were broad-based (nearly all sectors positive), with Healthcare, Materials, and Discretionary leading. Technology lagged slightly due to profit-taking in some mega-caps. 
• Rate Cut Expectations Fuel Gains: Rising expectations for a Fed rate cut in September, reinforced by commentary from Treasury Secretary Bessent and a drop in mortgage rates, continue to fuel market optimism. 
• Gold & Crypto Rally: Gold prices rebounded on a weaker dollar and rate cut speculation. Bitcoin surged to a new all-time high above $124,000. 
• Oil Prices Continue to Slide: WTI crude fell to 11-week lows, pressured by a surprise U.S. inventory build and an IEA forecast for increased global supply. 
• Yields & Dollar Fall: Treasury yields declined across the curve as rate cut bets intensified. The U.S. dollar also weakened against major currencies. 
• Focus on PPI & Trump/Putin Meeting: Markets now look to tomorrow’s Producer Price Index (PPI) report and a meeting between Presidents Trump and Putin on Friday. 

Market Overview 

The U.S. stock market’s relentless upward momentum continued today, with both the S&P 500 and Nasdaq Composite pushing to new all-time highs. The market has been on a powerful four-month run, driven by a combination of easing global trade tensions, moderating inflation, and, most recently, rising expectations for interest rate cuts from the Federal Reserve. Today’s session was a quiet, low-volume “melt-up,” with stocks ending near their best levels of the day. 

Index	Up/Down	% Change	Last
DJ Industrials	463.66	0.0104	44922
S&P 500	20.82	0.0032	6466
Nasdaq	31.24	0.0014	21713
Russell 2000	45.28	0.0198	2328

The rally was notably broad, with strong market breadth and significant outperformance from small caps (Russell 2000) for the second consecutive day. This suggests a healthy rotation and broadening of market participation beyond the mega-cap tech names that had been doing most of the heavy lifting. Healthcare, Materials, and Consumer Discretionary were among the top-performing sectors, while the market-leading Technology sector lagged slightly due to some profit-taking in giants like Nvidia and Microsoft. 

With no major economic data released, investors focused on commentary and positioning ahead of key events later in the week. Treasury Secretary Scott Bessent added to the dovish sentiment, calling for a 50-basis-point rate cut in September, which helped push Treasury yields lower across the curve. This backdrop of anticipated easier monetary policy continues to be a major tailwind for equities. Investors are now looking ahead to today’s Producer Price Index (PPI) report and a highly anticipated meeting between President Trump and Russian President Vladimir Putin on Friday.

Economic Data

The key economic data point yesterday was the weekly MBA Mortgage Applications, which showed a surge in refinancing activity as mortgage rates fell to their lowest since April. 

• MBA Mortgage Applications (Weekly): Refinance applications jumped 23% to a four-month high. The average 30-year fixed-rate mortgage fell 10 basis points to 6.67%. 

Commodities, Currencies, and Treasuries 

Gold prices snapped a modest two-day losing streak, with December futures gaining $9.30 (+0.27%) to settle at $3,408.30 per ounce. The rebound was supported by a weaker U.S. dollar and rising speculation of Fed rate cuts, reinforced by comments from Treasury Secretary Bessent. Crude oil prices continued their recent decline, with WTI settling down $0.52 (-0.82%) at $62.65/bbl, marking an 11-week low. 

Asset	Up/Down	Unit / % Change	Last
WTI Crude	-0.52	USD/bbl	62.65
Brent	-0.49	USD/bbl	65.63
Gold	9.3	USD/oz	3408.3
EUR/USD	0.0025	USD	1.1698
USD/JPY	-0.4	JPY	147.43
10-Year Note	-0.053	%	0.0424

A surprise weekly build in U.S. crude inventories, a production pop, and a bearish IEA supply forecast all weighed on prices. The U.S. dollar index (DXY) weakened as rate cut speculation intensified, slipping to 97.83, with the Euro and Yen both advancing against the greenback. Treasury yields fell broadly, with the 10-year yield dropping over 5 basis points to 4.237% and the 2-year yield down 4 basis points, as the market priced in a more dovish Fed. Bitcoin surged to a new all-time high, topping $124,500.

Looking Ahead 

The market will be closely watching today’s Producer Price Index (PPI) inflation report for further confirmation of the disinflationary trend. On Friday, key data points include Retail Sales, Import Prices, and Industrial Production. Also on Friday, a highly anticipated meeting between President Trump and Russian President Vladimir Putin could be a significant market mover, particularly for energy markets and geopolitical sentiment. Q2 earnings season continues, but with less intensity than in previous weeks.