Guotai Junan Securities·2025-07-25 07:25Core Insights - The report highlights that the US stock market has recently performed strongly, with the S&P 500 and Nasdaq indices frequently reaching historical highs, driven by positive trade negotiations and increased capital expenditures from AI technology leaders [5][6] - As of July 24, the S&P 500 index has risen by 1.3% and the Nasdaq 100 index by 1.7% over the past ten trading days, with the technology and internet sectors leading the performance [5][6] Trade Negotiations - The US has reached trade agreements with the Philippines and Indonesia, and a significant agreement with Japan, which includes reducing tariffs on Japanese goods from 25% to 15% [5][8] - The market is optimistic about the potential for further trade agreements with the EU before the August 1 deadline, which has increased risk appetite among investors [9] Earnings Performance - The earnings season has shown resilience, with over half of the 162 S&P 500 companies reporting results that exceeded market expectations; 84.6% of companies reported net profits above Wall Street's forecasts [11] - Google’s parent company, Alphabet, reported strong second-quarter results, with revenue and EPS surpassing expectations, and announced a significant increase in capital expenditures to $85 billion for 2025, up from an earlier estimate of $75 billion [11][14] Market Outlook - The report suggests a short-term upward trend for the US stock market, particularly in AI technology sectors, as companies maintain resilience despite potential inflationary pressures and the impact of tariffs [15] - If the effects of tariffs are limited, the Federal Reserve may consider further interest rate cuts, providing additional support for the stock market [15]