The U.S. stock market delivered a mixed yet powerful performance on Wednesday, July 2, as the S&P 500 and Nasdaq Composite reached record highs, driven by strong gains in technology stocks, a rebound in Bitcoin, and broad-based strength in commodities including oil and industrial metals.
Major Indices Show Divergence
Despite a slight dip in the Dow Jones Industrial Average, investor sentiment remained bullish across key benchmarks. The Nasdaq Composite surged 0.94%, closing at 20,393.13 points — a new all-time high — fueled by robust performances in tech giants. The S&P 500 also climbed 0.47%, reaching 6,227.42 points, marking its highest close ever. In contrast, the Dow Jones edged down 0.05% to 44,484.42 points, showing relative weakness in its more industrially weighted components.
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Tech Stocks Power Market Momentum
Technology continued to lead the charge in equity markets. Tesla stood out with a nearly 5% gain, boosting its market capitalization by approximately $48.1 billion (RMB 345 billion) overnight. This rally followed the release of Tesla’s second-quarter delivery figures, which, although down 13.5% year-over-year to 384,122 vehicles, exceeded the market’s most pessimistic forecasts.
This marks the second consecutive quarter of declining year-on-year deliveries for Tesla, following a 13% drop in Q1. However, investors appeared reassured by signs of stabilization after earlier concerns about demand and production slowdowns.
Other major tech players also posted solid gains:
- Apple: +2.22%
- NVIDIA: +2.58%
- Oracle: +5.0% — boosted by news of an expanded partnership with OpenAI to build additional data centers in the U.S.
- Google (Alphabet): +1.59%
Meanwhile, Microsoft (-0.20%), Amazon (-0.24%), and Meta (-0.79%) saw minor declines, highlighting selective strength within the mega-cap tech cohort.
Chinese ADRs Mixed Amid Global Risk-On Sentiment
The Nasdaq Golden Dragon China Index, which tracks U.S.-listed Chinese equities, rose 0.06%, reflecting balanced movements across the sector.
Notable performers included:
- Xiaopeng Motors: +0.60%
- Baidu: +0.46%
However, several major names declined:
- Alibaba: -2.86%
- JD.com: -0.70%
- Pinduoduo: -1.44%
- NIO: -0.85%
- Li Auto: -2.57%
- Bilibili: -2.34%
- NetEase: -1.32%
- Tencent Music: -0.36%
Despite these fluctuations, the broader trend suggests improving risk appetite toward Chinese assets amid easing regulatory fears and global liquidity optimism.
Bitcoin and Crypto Rally on Rate Cut Bets
Cryptocurrencies joined the risk-on move Wednesday, with institutional-grade assets seeing notable gains.
CME Bitcoin futures (BTC) rose 3.93%, settling near $11,000, while spot Bitcoin approached similar levels amid sustained buying pressure. The rally was supported by growing expectations of a Federal Reserve rate cut in the coming months.
Ethereum (CME DCR futures) outperformed with an 8.19% jump to $2,615, signaling renewed confidence in the broader digital asset ecosystem.
Market analysts attribute this upward momentum to shifting monetary policy expectations — particularly after weak U.S. employment data signaled economic softening.
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Commodities Surge: Oil and Industrial Metals Shine
Commodity markets posted broad gains, led by energy and base metals.
Energy Markets
Crude oil prices spiked on July 2:
- WTI Crude (August contract): +$2.00 to **$67.45/barrel, up 3.06%**
- Brent Crude (September contract): +$2.00 to **$69.11/barrel, up 2.98%**
The rise came amid supply concerns and geopolitical tensions affecting global energy flows.
Precious Metals
Safe-haven demand supported gold prices:
- Spot Gold: +0.51% to $3,355.98/oz
- COMEX Gold Futures: +0.57% to $3,368.90/oz
Industrial Metals
Industrial metals rallied on signs of improving global manufacturing sentiment:
- LME Copper: +$79 to **$10,013/ton**
- LME Aluminum: +$22 to **$2,620/ton**
- LME Zinc: +$44 to **$2,758/ton**
These gains reflect optimism around restocking cycles and potential stimulus measures in major economies.
Fed Rate Cut Odds Rise After Weak ADP Data
A key catalyst behind Wednesday’s market dynamics was the release of weaker-than-expected U.S. private sector employment data.
The ADP National Employment Report (commonly known as “small nonfarm payrolls”) showed a decline of 123,000 jobs in June — the first negative reading since March 2023. This unexpected contraction intensified speculation that the Federal Reserve may cut interest rates as early as July.
Both UBS and Citigroup have revised their forecasts for the upcoming June nonfarm payrolls report, predicting:
- UBS: +100,000 jobs; unemployment at 4.3%
- Citigroup: +85,000 jobs; unemployment at 4.4%
These estimates fall well below the market consensus of around 110,000 new jobs and suggest a rapidly cooling labor market.
According to the CME FedWatch Tool, the probability of a rate cut in July increased from 20% to 27.4% following the ADP data release. Traders are now pricing in at least two rate cuts by the end of 2025.
Even U.S. Treasury Secretary Benest (note: likely reference to current administration officials) has publicly urged the Fed to consider lowering rates by September, citing inverted yield curves and elevated borrowing costs as signals of policy lag.
FAQ Section
Q: Why did Tesla’s stock rise despite lower year-on-year deliveries?
A: Although Tesla’s Q2 deliveries fell 13.5% from last year, they surpassed the market’s worst-case expectations. Investors interpreted this as a sign that demand may be stabilizing after a tough first half, especially amid price cuts and inventory adjustments.
Q: What does the weak ADP report mean for investors?
A: A weak ADP reading often precedes a soft official nonfarm payrolls report. It raises hopes for earlier interest rate cuts by the Fed, which can boost stock and bond markets by lowering borrowing costs and increasing present valuations of future earnings.
Q: Is Bitcoin’s rally sustainable?
A: Short-term momentum is being driven by macro factors like anticipated Fed easing and institutional inflows. Long-term sustainability will depend on adoption trends, regulatory clarity, and integration into mainstream finance.
Q: How do falling Treasury yields affect equities?
A: Lower yields reduce discount rates used in equity valuation models, making future cash flows more valuable today — particularly benefiting growth stocks like tech and EV companies.
Q: Why are industrial metals rising?
A: Rising copper and aluminum prices reflect improving sentiment in global manufacturing and construction sectors. They’re also influenced by supply constraints and expectations of fiscal stimulus in China and other major economies.
Q: What drives investor interest in gold during market rallies?
A: Gold often rises alongside equities when inflation or devaluation fears dominate — not just during downturns. Currently, it's benefiting from real yield declines and central bank buying globally.
Market Outlook
With technology stocks regaining momentum, commodities strengthening, and monetary policy expectations shifting decisively toward easing, financial markets are entering a potentially transformative phase.
While near-term volatility remains possible — especially ahead of the official June jobs report — the overall trajectory favors risk assets supported by improving liquidity outlooks.
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