To The Moon

In a week that does not have ‘significant’ US economic reports or heavy-weight companies’ quarter earnings, US market directions will largely be dictated by Trump & his tariffs shenanigans.

That was exactly what happened post 04 July Independence Day.

On Mon, 07 Jul 2025, US stocks were sharply lower after a 3-day holiday break as investors keep their eyes glued to tariff trade-related developments.

This as US President Trump announced hefty tariffs of between 25% - 40% against Japan, South Korea and other trading partners, due to come into effect on Fri, 01 Aug 2025.

With tariffs back in the forefront, it was definitely causing some skittishness in the US market.

In addition, Trump’s further threats of an extra +10% tariff on countries aligning themselves with the "Anti-American policies" of the BRICS group of Brazil, Russia, India, China & South Africa.

It will be interesting to see how this additional +10% tariffs “threat” will play out for (a) India (that has taken US to task with the WTO) and (b) China (where a framework toward a ‘fragile’ agreement with China is still work-in-progress).

On Tue, 08 Jul 2025 Trump broadened his trade war, announcing he would impose a 50% tariff on imported copper. This sent US copper prices soaring and US stock prices lower. He also said he would soon introduce levies of up to 200% for pharmaceuticals.

Two days later on Wed, 09 Jul 2025 - US stocks rebounded after the Fed’s June 17-18 minutes of meeting, revealed only "a couple" of officials said they felt interest rates could fall as soon as this month.

By the time 4pm came a knocking: (see above)

• DJIA: +0.49% (+217.54 to 44,458.30).

• S&P 500: +0.61% (+37.74 to 6,263.26). Posted 20 new 52-week highs and 6 new 52-week lows.

• Nasdaq: +0.94% (+192.87 to 20,611.34). 2,988 stocks rose and 1,551 fell as advancing issues outnumbered decliners by a 1.93-to-1 ratio.

Wednesday’s trading volume on US exchanges were 18.10 billion shares changed hands vs 18.35 billion average for the last 20 sessions.

Suffice to say, many are waiting for clear updates on the trade talks that Trump administration has been talking and talking, but so far, it seems like a one-sided affair.

US Economic Reports.

Some of the “less” important repot out so far:

(1) NFIB optimism index.

• On Tue, 08 Jul 2025, US Small business optimism index for June 2025 came in at 98.6, below forecasts of 98.7 and 98.8 in May’s 98.8. Overall, it is holding slightly above the 51-year average of 98.

• The x-factor that contributed the most to index’s decline was “a substantial increase in respondents reporting excess inventories”.

• 19% of small business owners reported taxes remains as the single most important problem, up one point from May and rank #1 top problem again.

• The last time taxes was a concern and reached 19% was back in July 2021.

• Net percent of owners expecting better business conditions fell by -3 points to 22%.

(2) US Wholesale inventories.

• On Wed,09 Jul 2025, US Wholesale inventories report (final) for May 2025 was released. (see above)

• The US Commerce Department report showed a modest decrease by wholesale inventories in May to -0.3%, down by 0.5% from April’s 0.2%.

• The pullback by inventories matched economist expectations as well as the flash estimate.

• Overall US wholesale inventories decline may signal a slowdown (a) in the production or (b) distribution of goods, that can have a ripple effect on the broader US economy.

• And could potentially lead to a decrease in the USD value, as lower inventories can suggest reduced economic activity.

Both reports are moderately weak:

• The Optimism Index report edged down. Although it is still slightly above its long-term average, it showed (a) declining sales expectations, (b) rising concerns about excess inventories, and (c) persistent worries over taxes and labour costs.

• The US wholesale inventories reported a decline, indicating (i) cautious restocking and (ii) soft demand, that is typically a sign of economic caution rather than strength.

Delta Airlines Q2 Forecast.

With US companies’ Q2 2025 earnings are coming back into the conversation from next week onwards, much focus will be on $Delta Air Lines(DAL)$ as it prepares to report its earnings on Thu, 10 Jul 2025.

Consensus estimate for Q2 2025:

• Revenue is expected to come in at $15.45 billion vs Q2 2024’s non-GAAP $15.4 billion, a +0.32% YoY gain.

• Earnings per share (EPS) is estimated to be at $1.98 per share vs Q2 2024’s adjusted $2.36, a -16.10% YoY loss.

• Full year 2025's revenue is expected to be $57.49 billion and EPS at $5.47 per share.

• This is to be confirmed because DAL did not provide its FY 2025 guidance during Q1 2025 earnings reporting back on 09 Apr 2025, owing to Trump’s tariffs’ initial announcement throwing all businessess into turmoil.

Stock Price Movement.

DAL has rallied +28.81% over the past 3 months. This was driven in part by (a) easing tariff worries and (b) improved sentiment across the airline sector.

YTD, DAL is still down by -15.75% (as of 09 Jul 2025 closing) as concerns about (1) softening travel demand and (2) broader economic uncertainty continue to weigh.

DAL has underperformed both the broader market and the airline sector.

After reaching a year high near $70, the stock has steadily retreated, trading around $50.70.

There exists a +39% upside potential to reach its $70 peak, a significant recovery plus opportunity if market conditions continue to improve. Willing to take a chance?

Remember to check out my other posts. (See below). Help to Repost ok, Thanks.

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• Do you think US market will continue to rally today & tomorrow?

• Do you think DAL will rally after earnings are out, just like Q1 2025 when it soared +23% ?

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