US stocks managed to notch record highs Monday in subdued trading as the US and European Union reached a new trade pact, setting the stage for a pivotal week in the markets.
The S&P 500 (^GSPC) closed just above the flatline to log its sixth straight record finish, while the Nasdaq Composite (^IXIC) climbed 0.3% to secure yet another all-time high. The Dow Jones Industrial Average (^DJI) slipped 0.2%, reflecting a cautious tone as investors braced for a barrage of economic catalysts.
Driving the day’s headlines was a US-EU agreement to set European tariffs at a baseline 15%, far below the 30% previously threatened. President Trump hailed the deal as “the biggest of them all,” though European leaders struck a more cautious note. Meanwhile, reports of potential US-China talks in Stockholm boosted hopes for extending the current tariff truce beyond the looming Aug. 12 deadline.
The muted gains come ahead of one of the most consequential weeks of the summer. More than 150 S&P 500 companies are set to report earnings, including tech giants Meta (META), Microsoft (MSFT), Amazon (AMZN), and Apple (AAPL). The Federal Reserve begins its two-day meeting Tuesday, with markets watching closely for any hints of a possible September rate cut despite expectations for rates to hold steady at 4.25%-4.50%.
On the economic data front, inflation and labor are in focus. Thursday’s release of the Fed’s preferred inflation gauge—the personal consumption expenditures (PCE) index—is projected to show a modest rise. At the same time, Friday’s July jobs report will provide a key read on the labor market’s strength.
With trade, earnings, and policy all colliding, Wall Street is gearing up for a week that could set the tone for the rest of the year.
