The S&P 500 reached a new record closing high on Tuesday, though gains were limited as investors weighed a busy slate of earnings reports and a pullback in semiconductor stocks.

By the close at 4:00 p.m. ET, the Dow Jones Industrial Average was up 170 points (0.40%), the S&P 500 edged higher by 0.03% to a record close of 6,307.67, and the Nasdaq Composite fell 0.4% as tech stocks, especially chipmakers, lost ground.

Chip Stocks Weaken After AI Project Scaled Down

Semiconductor giants like NVIDIA, Broadcom, and AMD declined after The Wall Street Journal reported that SoftBank and OpenAI have significantly scaled back their ambitious $500 billion Stargate AI project.

Originally launched with a planned $100 billion initial investment, the project has now been reduced to a smaller single data center, cooling optimism about the rapid expansion of U.S. AI infrastructure and dragging down the broader tech sector.

Texas Instruments is set to report earnings after the market close.

Earnings Season Heats Up

This week marks a peak in the earnings calendar, with more than 85% of S&P 500 companies expected to report. So far, about 12% have released results, with 86% beating earnings expectations and 67% reporting better-than-expected revenue—factors that helped propel the S&P 500 and Nasdaq to record levels in the previous session.

Notable Stock Moves

• Coca-Cola shares dipped nearly 1%, despite strong Q2 earnings, as tariff-related headwinds weighed on sentiment. The company reaffirmed guidance at the high end of its forecast.
• General Motors fell sharply after reporting a significant year-over-year drop in second-quarter profits, citing weakness in its key North American market.
• Northrop Grumman rose after raising its full-year profit outlook, supported by steady demand for its defense systems and aircraft amid rising geopolitical tensions.
• Philip Morris slipped as Q2 revenue missed expectations, despite continued strength in its smoke-free product lines.
• D.R. Horton gained strongly after beating expectations with fiscal Q3 earnings and delivering 23,160 homes, above the top end of its guidance.
• Intuitive Surgical is expected to post results after the bell.

Spotlight on Tesla and Alphabet

All eyes are on Tesla and Alphabet, the first of the “Magnificent Seven” tech leaders to report this earnings season. Both are due to announce Q2 results on Wednesday.

Tesla is under pressure after California data showed a 21.1% drop in Q2 registrations. Investors are also watching for any early signs of how Trump’s proposed tariffs may be affecting corporate profits.

Tariff Worries and Rate Uncertainty Weigh on Markets

Despite a series of recent record highs, market momentum has slowed amid growing concerns about trade tariffs and uncertainty around future interest rate moves.

President Trump has announced new tariffs—ranging from 20% to 50%—on goods from key U.S. trading partners, set to begin August 1. Additional duties include a 50% tariff on copper and a potential 200% tariff on pharmaceutical imports.

These proposed measures have raised fears of renewed inflation, with the Federal Reserve expected to keep interest rates unchanged at its meeting next week. The Fed has cited tariffs as a major reason for maintaining its current stance.

Fed Chair Jerome Powell is scheduled to speak at a conference in Washington, D.C., later Tuesday, though it’s unclear whether he’ll address monetary policy due to the Fed’s pre-meeting blackout period.

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