The S&P 500 continued its upward march, rising another 1.6% last week and touching a fresh all-time high. AI-driven enthusiasm remains the dominant force behind this summer rally, but fresh risks are beginning to surface that could test investor confidence in the days ahead. One key catalyst is just around the corner: July 9 marks the end of the 90-day tariff pause that was first announced in April. While it is not a firm deadline, the expiration reopens the door to fresh trade tensions. With President Trump’s tariff policies once again in focus, markets may face renewed volatility in the days ahead.
The financial impact of these tariffs is already being felt. According to Treasury data, government receipts from customs and certain excise taxes reached $22.3 billion in May, up from $17.4 billion in April and more than double March’s total of $9.6 billion. This jump reflects the full impact of the 10% duties imposed on most United States imports starting April 5. Since the beginning of the year, more than $92 billion has flowed into government receipts through tariff collections.
At the same time, equity valuations are flashing caution. The S&P 500 now trades at 22.2 times forward earnings, well above its long-term average of 15.8. While corporate earnings are projected to grow by 8.5% this year and 14% in 2026, these elevated multiples leave little margin for error.
Investor sentiment, too, appears stretched. CNN’s Fear and Greed Index currently stands at 78, placing it deep into the extreme greed zone. The index aggregates various indicators such as price momentum, market volatility, and demand for safe assets, and such high readings have historically preceded short-term pullbacks.
Adding to this picture is the S&P 500’s Relative Strength Index, which has reached its most overbought level since July 15, 2024. An RSI reading above 70 suggests that buying momentum has become unusually strong and that the market may be due for a pause, or even a pullback.
The rally may not be over yet, but warning signs of a pullback are flashing in bold.
Weekly Earnings Roundup: Surprises & Misses
Last week saw earnings from only one prominent company, Constellation Brands (NYSE: STZ), the parent of Corona beer.
Constellation posted fiscal first-quarter results on Tuesday that fell short of analyst expectations. Revenue came in at $2.52 billion, down 6% YoY, slightly below expectations. Adjusted earnings were $572.9 million, or $3.22 per share, compared to $654.5 million, or $3.57 per share, in the same quarter last year. The company cited weaker consumer demand as a key factor behind the decline. Despite the miss, Constellation maintained its full-year earnings guidance of $12.60-$12.90 per share. Shares rose around 7% for the week.
Top Gainers
Datadog (NASDAQ: DDOG) led the charge this week, jumping 16% after it was announced that the cloud monitoring company would be added to the S&P 500 index. The inclusion reflects growing recognition of its role in the AI and DevOps landscape, and investors cheered the added exposure that typically follows such moves.
Hewlett Packard Enterprise (NYSE: HPE) also surged 15% after the DOJ approved its proposed acquisition of Juniper Networks. The deal aims to enhance HPE’s footprint in AI-native networking, a key battleground in the tech space.
The biggest headline came from Tripadvisor (NASDAQ: TRIP), which soared more than 30% after activist investor Starboard Value disclosed a 9% stake in the company. Investors expect operational improvements and potential restructuring as Starboard pushes for changes.
Top Losers
Centene Corporation (NYSE: CNC) had a brutal week with its share price declining by more than 35% after the healthcare giant pulled its 2025 guidance. The move came after updated actuarial data suggested rising costs under the Medicaid program. Law firm Hagens Berman is already investigating whether management misled investors ahead of the announcement.
Elevance Health (NYSE: ELV) fell ~9% during the week, hitting a 52-week low. The drop was due to a bigger sell-off triggered in the healthcare sector after Centene pulled its full-year financial guidance.
Meanwhile, Marvell Technology and AMD also saw declines of nearly 6% and 4%, respectively, with investor fatigue and valuation concerns playing a role.
Upcoming Earnings: Key Stocks to Monitor
This week’s earnings calendar features only one major name, Delta Air Lines (NYSE: DAL). Other companies set to report include ConAgra Brands (NYSE: CAG) and Levi Strauss (NYSE: LEVI).