Stock Market Slides as Dow and S&P500 Slips on Tariff Fears and Soft ISM Services Data

Dow Jones Industrial Average (DJI) and S&P 500 (^GSPC) Slide as Nasdaq (^IXIC) Holds Flat

The Dow fell 133 points (–0.3%) to 43,976, while the S&P 500 dipped 0.2% to 6,307.06. The tech-heavy Nasdaq Composite hovered near breakeven, off just 0.1%. These moves reversals Monday’s broad rally, as investors assessed fresh economic data and evolving tariff threats.

ISM Services Index at 50.1, Prices Surge Toward Eight-Year High

July’s ISM services survey registered 50.1—its lowest since May 2020 and below the 51.2 consensus—teetering on the brink of contraction. The prices component jumped to 69.9, suggesting accelerating cost pressures across health care, real estate and business services. Employment within services slipped to 46.4, underscoring that jobs growth may be slowing as wage demands plateau.

S&P Global Composite PMI Accelerates to 55.1; U.S. Economy Faces Mixed Signals

Contrasting the ISM, S&P Global’s composite PMI rose to 55.1 from 52.9 in June, indicating an annualized growth run-rate of roughly 2.5% for Q3. The divergence—robust output alongside weakening hiring—reflects persistent tariff-related cost inflows even as overall demand holds up.

Palantir (PLTR) Rockets 8% After First $1 Billion Revenue Quarter

Shares of Palantir (PLTR) jumped as much as 9% in early trading after reporting Q2 adjusted EPS of $0.16 on revenue of $1.00 billion—toppling consensus of $0.14 and $940 million. Management raised full-year guidance, buoyed by a newly consolidated ~$10 billion, decade-long U.S. Army contract, solidifying Palantir as one of the top software plays in 2025.

DuPont (DD) Upside Surprise, Eaton (ETN) Guidance Stumbles

DuPont (DD) beat Q2 estimates with $1.12 EPS vs. $1.06 expected on $3.26 billion revenue, and jumped over 5%. The company lifted its full-year outlook to factor in tariff mitigation efforts. Conversely, Eaton (ETN) slipped over 6% after Q3 guidance of $3.01–3.07 EPS missed the $3.09 consensus—even after delivering $2.95 on $7.03 billion in Q2 results.

Caterpillar (CAT) Earnings Miss Weigh on Industrials

Caterpillar (CAT) reported Q2 EPS of $4.72 vs. $4.90 consensus while revenue of $16.57 billion outpaced forecasts but couldn’t offset margin compression. Shares dropped over 3%, as a $1.5 billion full-year tariff headwind looms and dealer inventories in North America remain bloated.

International Paper (IP) Downgrade Sends Shares 13% Lower

Adjusted Q2 EPS of $0.20 fell well short of the $0.39 estimate, though revenue of $6.77 billion topped $6.65 billion expectations. JPMorgan’s Detlef Winckelmann cut IP to Neutral from Overweight, citing skepticism around 2027 guidance, and set a $54 price target—still implying 17% upside from current levels.

Pfizer (PFE) Beats Consensus, Vertex (VRTX) Guidance Shocks

Pfizer (PFE) posted Q2 EPS of $0.78 vs. $0.58 expected, on $14.65 billion in revenue against a $13.56 billion forecast. Shares climbed 2.8% as full-year EPS guidance was hiked. In stark contrast, Vertex Pharmaceuticals (VRTX) plunged 14% after Q2 adjusted EPS of $4.52 beat $4.26 consensus but guided cautiously amid pipeline investments.

Hims & Hers Health (HIMS) and American Eagle (AEO) Diverge

Hims & Hers (HIMS) shares sank over 10% after issuing Q3 EBITDA guidance of $60–70 million vs. the $77 million StreetAccount consensus. Meanwhile, American Eagle (AEO) initially spiked 16% on a viral Sydney Sweeney ad endorsement by President Trump, before pulling back to $12.10 (–8.9%) amid controversy over the campaign’s messaging.

Wayfair (W) Posts First Profit Since 2021; Tyson Foods (TSN) Raises Outlook

Wayfair (W) delivered diluted EPS of $0.11 vs. a loss of $0.37 expected, on $3.27 billion vs. $3.12 billion in Q2 revenue—driving a 10% pre-market pop. Tyson Foods (TSN) beat fiscal Q3 estimates, raised its FY revenue forecast, and saw shares tick up 4% on sustained chicken demand despite beef margin pressures.

Opendoor (OPEN) and Joby Aviation (JOBY) on the Move

Opendoor (OPEN) surged 16% after Q2 results beat on both top and bottom lines, fueled by renewed investor interest and a bullish EMJ Capital outlook. Joby Aviation (JOBY) climbed 5% premarket on plans to acquire Blade Air Mobility’s helicopter business for up to $125 million, unlocking a network of urban vertiport terminals.

Amazon (AMZN) Cloud Slows, Microsoft (MSFT) & Google (GOOG) Gain Ground

AWS revenue grew 17.5% to $30.9 billion—tracking toward the low end of its 17–19% growth range—while Microsoft Azure jumped 26% to $29.9 billion and Google Cloud surged 32% to $13.6 billion. AMZN stock has trailed, down 8% last week against a 2% gain for MSFT.

Tesla (TSLA) Board Approves $30 Billion Musk Pay Plan

Tesla (TSLA) shares rose 3% after the board unveiled a $30 billion alternative compensation plan for CEO Elon Musk, contingent on shareholder approval, in response to Delaware court challenges to his original 2018 award. TSLA traded at $308.27, down 0.3%.

Coinbase (COIN) Downgraded; Crypto Stocks Under Pressure

Coinbase (COIN) was cut to Sell by Compass Point, with a $248 price target implying 21% downside from $304.73, as analysts warn of choppy Q3 crypto markets and fading retail interest in crypto-treasury stocks.

Oil & Metals: WTI at $65.49, Brent at $66.72; Gold Near Records

Crude benchmarks extended losses—WTI at $65.49 (–1.21%), Brent at $66.72 (–1.08%)—on OPEC+ supply increases and concerns over a U.S. slowdown. Gold Dec ’25 (GC=F) held near $3,435 (+0.24%), buoyed by tariff-driven inflation fears.

Tariff Turmoil: Semiconductors, Pharma, India on Deck

President Trump signaled within a week he’ll unveil separate tariffs on semiconductors and pharmaceuticals—pharma levies potentially up to 250%—as he presses to repatriate high-tech manufacturing. India faces “substantial” tariff hikes beyond the 25% already announced, while Swiss officials rushed to Washington to stave off a 39% levy on exports.

Fed Watch: Four Candidates in the Frame, September Cut Odds Surge

Trump narrowed his Fed chair shortlist to four, excluding Treasury Secretary Bessent. After five consecutive hold meetings, markets now price nearly a 90% chance of a September rate cut, with cumulative easing likely to resume by year-end.

Buybacks & Earnings Breadth Support Equities

July saw record U.S. buybacks of $165.6 billion, bringing YTD repurchases to $926.1 billion—led by Financials (XLF), Technology (XLK) and Communication Services (XLC). Over 81% of S&P 500 companies have topped Q2 expectations, underpinning strategist calls to “buy the dip.”

UK Services PMI Falls to 51.5; New Orders Slowest Since 2022

S&P Global’s UK services PMI eased to 51.5 in July from 52.0, with new business dropping at the fastest rate in nearly three years—mirroring a jobs slowdown that could force the Bank of England to cut rates six times next 12 months, potentially down to 2.75% from 4.25%.

Household Pain: 2.64 Million Savers to Pay Tax on Interest

HMRC forecasts 2.64 million U.K. savers will hit the personal savings allowance limit this tax year, generating £6 billion in revenue. Basic-rate taxpayers face bills on interest above £1,000; higher-rate payers above £500.

UK Tech Spotlight: GlobalData (DATA.L) & Vodafone (VOD.L)

GlobalData (DATA.L) trades at £1.41 with a £2.38 target (+69%), on 15% revenue growth to £329 million and a 16.4x forward P/E. Vodafone (VOD.L) reiterated €2.4–2.6 billion free-cash-flow guidance, with UBS eyeing 120 pence (+44%) as Three UK integration gains traction.

European Equities: Swiss SMI Down 0.9%; Novartis & Roche Slip

The Swiss Market Index fell as much as 1.9% intraday, trimming to –0.88% by mid-morning—led by Novartis (NVS) –0.7%, Roche (RHHBY) –1.4%, UBS (UBS) –1.8% and Richemont (CFRUY) –0.7%—on tariff jitters and drug-price clampdowns.

Strategic Takeaways & Recommendations

• Bullish (Buy): PLTR, DD, PFE, W, TSLA, DATA.L, JOBY

• Neutral (Hold): CAT, AMZN, AEO, TSN, OPEN, VOD.L

• Bearish (Sell): ETN, IP, VRTX, HIMS, COIN, YUM

With economic indicators flirting with contraction and tariff volatility rising, selective opportunities remain in high-growth software, cloud infrastructure and recurring-revenue industrials—but investors should trim exposure to cyclical manufacturing and over-leveraged biotech.

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