It would appear that the Dow is headed to a new record, though that may not happen today, as Dow futures at 8:00 am ET are 164 points in the red, mostly due to Dow component IBM sliding in pre-market trading.
International Business Machines (IBM) delivered stronger results than expected and raised its forecast for full-year free cash flow, but revenue and gross margin in the software business were below consensus. IBM shares have outperformed the S&P 500 this year, but the stock is down six percent prior to the opening bell.
After the close Wednesday, Alphabet (GOOG) and Tesla (TLSA) reported second quarter results, with Alphabet putting up strong numbers across all of their business segments. The stock is higher by nearly four percent in the pre-market.
Elon Musk's Tesla did not fare as well, the stock down more than six percent prior to the open. The company reported a 16% decline in auto revenue as sales fell for a second straight quarter and again fell short of analysts’ estimates. Earnings per share came in at 40 cents adjusted vs. 43 cents expected on revenue of $22.50 billion vs. $22.74 billion estimates.
Other companies reporting Thursday morning include Honeywell (HON) Union Pacific (UNP), and Blackstone (BX).
Honeywell fell about three percent pre-market as the company experienced margin compression during the quarter.
Blackstone beat estimates on earnings per share of 98 cents, versus 58 cents a year ago. GAAP Net Income was $1.6 billion for the quarter on revenue of $2.035 billion. Shares are three percent higher pre-market.
Union Pacific's (UNP) earnings rose rose to $3.03, topping Wall Street expectations of $2.91. The company reported EPS of $2.71 per share in the same period last year. The company is apparently in merger talks with Norfolk Southern, a move that would combine the largest railroad operators from the east and west. Shares are flat heading into the open.
Intel reports after Thursday's close and is expected to report a decline of 50% in EPS to $0.01 on a more than 7% drop in sales to $11.88B. shares of Intel ar up 17% year-to-date, but the stock price has been cut by more than half over the past 18 months.
Overnight, Japan's NIKKEI gained more than 1.5%. Hong Kong's Hang Seng was up 0.5%. European markets are all up as the day progresses.
Gold and silver are being hammered on the COMEX, a day after gold hit a five-week high at $3,446.20 and silver made a 14-year high at $39.90 per ounce. An hour prior to stocks opening, gold is at $3,665 and silver holding up better, at $39.35.
The Dow Industrials and the Dow Transportation Average are two indices that have not yet reached previous highs, which, if one adheres to Dow Theory is a troubling sign for the ongoing rallies on the S&P and NASDAQ. If the Industrials do somehow manage to make new highs, the trend can only be confirmed by the Transports doing the same, though that index is still 1,500 points below highs set in late November of last year.
Finally, in case there are still doubts that the market is overheating, the Shiller PE is sitting at the second-highest ever after closing yesterday at 38.79. The all-time high for the Shilller PE - which accounts for earnings over a 10-year period - was in December 1999, at the height of the dotcom boom. That high water mark was 44.19.
With no restraints on FOMO or dip-buying by institutions and retail alike, there's a good chance that the current super-bubble will exceed all expectations. Such a development would clearly please President Trump, who could complain again that people stop looking into the "old news" Epstein files and focus on the marvelously-inflated stock market.
Woopie!
At the Close, Wednesday, July 23, 2025:
Dow: 45,010.29, +507.85 (+1.14%)
NASDAQ: 21,020.02, +127.33 (+0.61%)
S&P 500: 6,358.91, +49.29 (+0.78%)
NYSE Composite: 20,921.84, +263.05 (+1.27%)
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