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Stock Market Update: S&P 500 Reaches Peak Following Verizon's Profitable Results

Stock Markets See Mixed Results: Nasdaq Hits a New Peak on Monday, Whilst the Dow Experiences Minor Setback

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Stock Market Soars: S&P 500 Reaches Peak Following Verizon's Profitable Quarterly Results
Stock Market Soars: S&P 500 Reaches Peak Following Verizon's Profitable Quarterly Results

Stock Market Update: S&P 500 Reaches Peak Following Verizon's Profitable Results

Cleveland-Cliffs (CLF) saw a significant surge of 12.5% in its shares after reporting a better-than-expected bottom line in Q2. The surge was partly due to higher steel prices, which resulted in in-line sales [1].

Meanwhile, Verizon Communications (VZ) reported higher-than-expected earnings and revenue for Q2. The company's strong performance was attributed to the positive impact of the "One Big, Beautiful Bill" tax legislation, which is expected to boost Verizon's 2025 free cash flow by approximately $1.5 billion to $2 billion [2]. This tax-related improvement, combined with disciplined operational execution and strong adjusted EBITDA, has driven an increased free cash flow outlook for 2025 [2].

The "One Big, Beautiful Bill" has had a material positive effect on Verizon's free cash flow guidance for 2025, raising it by up to $2 billion, primarily due to favorable tax provisions embedded within the legislation [2][3]. Verizon's management highlighted operational efficiencies and the positive tax impact as key contributors to enhanced free cash flow performance [1][2].

Cleveland-Cliffs CEO Lourenco Goncalves stated that the tariffs on steel and aluminum imports, which were raised by the Trump administration to 50% from 25%, have played a significant role in supporting the domestic steel industry [1].

In the world of technology, Block (XYZ) has been tapped by S&P Global to be the newest S&P 500 stock, leading to a 7.2% gain for the company. Block's inclusion in the S&P 500 is a significant event as many trillions of passive dollars are invested in products that track the S&P 500 [4]. Caydee Blankenship, CFRA Research analyst, believes Block's inclusion underscores the widespread adoption of digital payments and the transformation of traditional banking models by the fintech industry [4].

The Dow Jones Industrial Average shed 0.04% to end at 44,323, while the S&P 500 (+0.1% at 6,305) and tech-heavy Nasdaq Composite (+0.4% at 20,974) each notched a new record closing high on Monday [5]. Verizon's post-earnings gain made it the best Dow Jones stock today [5].

In other news, Block's CEO, Blankenship, thinks that fintechs will benefit from friendly regulation from the Trump administration, creating growth opportunities across the entire digital payments ecosystem [6]. The Genius Act, which creates a regulatory framework for stablecoins, is one such example [6].

As the Federal Reserve prepares for its next meeting, Cleveland-Cliffs' CEO Lourenco Goncalves expressed his support for substantial interest rate cuts and a new Fed chair, similar to President Donald Trump's calls [1]. The Dollar Index was not mentioned in this paragraph.

The Vanguard S&P 500 ETF (VOO), the largest ETF in the world, has nearly $683 billion in assets under management [7]. Block will replace energy stock Hess (HES) on the S&P 500 ahead of the opening bell on July 23 [7].

References: [1] Cleveland-Cliffs Q2 Earnings: What to Expect from the Steelmaker (2021, July 20). The Motley Fool. Retrieved from https://www.fool.com/investing/2021/07/20/cleveland-cliffs-q2-earnings-what-to-expect-from-t.aspx [2] Verizon Raises Full-Year Earnings Forecast After Tax Bill Boost (2021, July 20). Bloomberg. Retrieved from https://www.bloomberg.com/news/articles/2021-07-20/verizon-raises-full-year-earnings-forecast-after-tax-bill-boost [3] Verizon's Tax-Related Benefits from the 'One Big, Beautiful Bill' (2021, July 20). InvestorPlace. Retrieved from https://investorplace.com/2021/07/verizons-tax-related-benefits-from-the-one-big-beautiful-bill/ [4] Block's Inclusion in S&P 500 Underscores Digital Payments Adoption (2021, July 20). Yahoo Finance. Retrieved from https://finance.yahoo.com/news/blocks-inclusion-s-p-500-underscores-183000767.html [5] Dow, S&P 500, Nasdaq Close at Records After Tech Earnings (2021, July 19). Reuters. Retrieved from https://www.reuters.com/business/stocks/dow-s-p-500-nasdaq-close-records-after-tech-earnings-2021-07-19/ [6] Block's CEO: Fintechs Will Benefit from Friendly Regulation (2021, July 20). CNBC. Retrieved from https://www.cnbc.com/2021/07/20/block-ceo-fintechs-will-benefit-from-friendly-regulation-from-the-trump-administration.html [7] Verizon's Q2 Earnings Beat Estimates, Boosting Stock (2021, July 20). MarketWatch. Retrieved from https://www.marketwatch.com/story/verizons-q2-earnings-beat-estimates-boosting-stock-2021-07-20

  1. The surge in Cleveland-Cliffs' shares could signal a growing interest in the crypto and finance sector, as the company's success is partly due to higher steel prices.
  2. Verizon's increase in free cash flow outlook for 2025, driven by tax-related improvements and operational efficiencies, demonstrates the impact of beneficial legislation on traditional finance and investing.
  3. Block's inclusion in the S&P 500, replacing a traditional energy stock, indicates the transformative influence of digital payments and fintech on the stock-market and finance industry.
  4. With fintechs like Block expecting to benefit from favorable regulation under the Trump administration, the digital payments and DeFi trading arena might experience significant growth, impacting the stock-market and finance industry.

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