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COMMENTARY:
- The S&P 500 index finished up 1.5% for the week ending July 25, 2025, notching record highs every single day—a feat not seen since 2021. The main drivers and market/economic highlights for the week included: Strong Corporate Earnings: Robust earnings, especially from major blue-chip and technology firms, fueled investor optimism. Hopes Around Global Trade Deals: Investor optimism grew as President Trump announced new trade agreements that helped ease worries about the economic fallout from protectionism and boosted global risk sentiment. Steady Economic Data: U.S. GDP growth forecasts remained resilient with expected growth around 2.5% for Q2, supported by ongoing gains in consumer spending and strong balance sheets among households and corporations.
- Health Care gained 3.5% for the week, driven by several notable market and economic factors, as well as strong performance from key index constituents. Strong Corporate Earnings from leading healthcare and pharmaceutical companies, surpassing analyst expectations. Eli Lilly (+5.3%) was the top contributor to the sector’s performance for the week. Eli Lilly’s shares surged on the back of another exceptional earnings report and strong forward guidance. Johnson & Johnson (+2.8%), AbbVie (+0.5%), and Abbott Labs (+2.3%) all also posted gains and contributed positively.
- The Materials Sector rose 2.4% and was fueled by a favorable macroeconomic environment, a weaker dollar, positive earnings, and supply-demand tailwinds for key materials. Linde PLC (+1.7%) stood out as the most significant individual contributor to performance for the week at almost 16% of the index. Other notable positive contributors included Sherwin-Williams and Newmont Corporation.
- Technology’s performance put the sector in last place this week, up only 0.5%. Market participants continued to favor companies with significant exposure to artificial intelligence and cloud infrastructure, themes that remained robust even as broader market momentum slowed. As one of the sector’s largest holdings, Microsoft (0.7%) delivered standout earnings driven by sustained growth and positive guidance for the remainder of 2025. Additional support came from other large-cap names such as Apple (+1.3%), Nvidia (+0.6%) and Broadcom (+2.4%).
ETF Tidbits:
Overall, the ETF market saw strong inflows this week, fresh product launches, and new record asset levels on the back of macro optimism, robust corporate results, and investor positioning around trade policy and interest rates. The influx into both traditional and digital asset ETFs reflects broadening and deepening investor participation across asset classes.
New ETF Launches: There were 29 new ETF launches in the US market this week, reflecting continued product innovation and investor appetite for niche or thematic exposures.
Interest Rate Environment: Treasury yields remained elevated (10-year at 4.40%), which influenced flows into bond ETFs as well as equity income and defensive sector products.
Crypto ETFs See Renewed Interest: Crypto-linked ETFs, particularly those tracking Ethereum, attracted over $1.1 billion in inflows. This was tied to the first anniversary of Ethereum ETF launches and rising digital asset prices.
