It was a fitting end to a wild week: on the final trading day of July, the two biggest names in tech went in opposite directions. Amazon soared, Apple sank, and lurking behind both was a bond market flashing warning lights. The result was a modest gain that felt a lot more mixed than the numbers suggest.
Amazon steals the show
Amazon (AMZN) was the star, jumping roughly 12% after Thursday's blowout report. The headline: Amazon Web Services (AWS) posted its fastest revenue growth in more than four years. After a week of nerves about whether Big Tech's massive AI spending would ever pay off, AWS reassured investors that the cloud - and the AI demand behind it - is very much accelerating.Apple's guidance problem
Apple (AAPL) told the opposite story. The iPhone maker beat on both earnings and revenue, but the stock still fell about 7% - because the outlook disappointed. Management guided next-quarter sales to roughly $111.7-113.7 billion, below the ~$114.8 billion Wall Street wanted, and flagged rising component costs and slowing growth in key segments. A reminder that in this market, guidance matters more than the quarter just reported.The real overhang: surging yields
Here's what capped the whole rally. Treasury yields spiked to multi-year highs: the 10-year hit 4.737% (its highest since January 2025) and the 30-year touched around 5.22% - a level not seen since 2007. When you can earn 5%+ risk-free, stocks have to work harder to justify their prices. That's why the S&P 500 pared an early 0.7% gain to a smaller advance by the close.
The indices - and a losing July
- Nasdaq: ~+1.3% - led by Amazon and the AI trade
- S&P 500: modest gain, after giving back most of an early rally
- Dow: ~+0.4% · Russell 2000: +1.4%
Despite Friday's lift and a strong Big Tech earnings season, the S&P 500 finished July in the red - a month defined by the Fed's hawkish hold and relentlessly rising yields.
Inflation check: the PCE report
The Fed's preferred inflation gauge came in mixed. Core PCE rose just 0.1% for the month - below the 0.2% expected - and held at 3.3% annually, in line with forecasts. The headline rate at 3.7% is still uncomfortably high, and rising oil prices aren't helping. Cooler-than-feared on the margin, but not the all-clear the bond market wants.
The Takeaway
Friday captured the whole market in miniature: the AI trade is alive (Amazon, Microsoft, Nvidia), but rising yields are the ceiling. Amazon proved the cloud boom is real; Apple proved that even a beat isn't enough without a strong outlook; and the 30-year yield at a 2007 high proved the Fed's inflation fight still hangs over everything. After Wednesday's plunge and Thursday's Microsoft-led rebound, the market ends the month resilient but on edge. Constructive, but watch the bond market - as long as yields keep climbing, every rally has a lid. Want to see which names look cheap after the earnings whipsaw? Screen them in the stock screener.
This article is for informational purposes only and is not financial advice. Always do your own research before investing.
