Pre-Markets Shine on Japanese Auto Trade Deal

Wednesday, July 23, 2025

Pre-market futures are up today, led by foreign auto companies — particularly those in Japan. A new trade agreement was announced that lowers tariffs on Japanese imported autos to +15% from the +27.5% recently slapped on by President Trump. Sweetening the deal is a reported $550 BILLION in investments and loans.

Thus, we see this morning Toyota Motors TM up +14% in early trading, with Honda Motor Co. HMC +11%. Toyota had been saddled with a Zacks Rank #5 (Strong Sell) and Honda with a #4 (Sell), with double-digit earnings losses expected in quarterly reports early next month. EU automakers are hopeful for a similar deal, as we see companies like Stellantis STLA up +6% ahead of today’s open.

Thus, major indexes are up fairly robustly. The Dow is +240 points at this hour, +0.54%, while the S&P 500 — riding successive all-time closing highs — is +24 points, +0.38%. The Nasdaq is creeping higher, +24 points or +0.10%, while the small-cap Russell 2000 is leading the pack again: +19 points, +0.87%. Bond yields continue to quiet: +4.37% on the 10-year and +3.85% on the 2-year.

Q2 Earnings This Morning at a Glance: T, NEE

The big Q2 reports happen today after the market closes, but AT&T T posted modest beats on both top and bottom lines this morning in the telecom major’s Q2 report. Earnings of 54 cents per share outperformed the Zacks consensus by 3 cents, with revenues of $30.85 billion up +1% from estimates, largely on improved subscriber sales in the quarter. Yet shares are down -2.5% in early trading, after gaining +20% year to date. For more on T’s earnings, click here. https://www.zacks.com/stock/news/2606931/att-t-surpasses-q2-earnings-and-revenue-estimates

NextEra Energy NEE also outpaced expectations by 3 cents on its bottom line, with earnings of $1.05 per share, even as revenues of $6.7 billion missed the Zacks consensus by -7.28%. However, steady guidance and a solid dividend yield are helping the stop stay afloat +0.4% in pre-market action. NEE is +8% year to date. For more on NEE’s earnings, click here.

What to Expect from the Stock Market Today

After the opening bell, Existing Home Sales for June is due for release. Analysts expect a range-bound number where we’ve been the past few months, around 4 million seasonally adjusted, annualized units. Last time around, the Northeast, Midwest and South all saw sales growth from existing homes; only the West was negative. The median existing home sale price a month ago was $422,800.

Also, major Q2 earnings reports are out after the close, headlined by Alphabet GOOGL and Tesla TSLA — two of the so-called “Magnificent 7” stocks. Yet digging into these charts, we can see this is very much a tale of two disparate realities. While Alphabet expects higher than +13% earnings growth and better than +11% revenue gains, Tesla is expected to be down -25% on its bottom line and -12% on the top. GOOGL is riding a streak of 9-straight quarters beating earnings, while Tesla has missed in 6 of its last 8.

We also expect to hear from IBM IBM, Southwest Airlines LUV, ServiceNow NOW and Las Vegas Sands LVS. We’re now in the heart of Q2 earnings season, as we’re hearing from multiple companies in multiple sectors on the same day (as opposed to big banks at the start of the cycle and retailers at the end).

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NextEra Energy, Inc. (NEE): Free Stock Analysis Report
 
AT&T Inc. (T): Free Stock Analysis Report
 
Toyota Motor Corporation (TM): Free Stock Analysis Report
 
International Business Machines Corporation (IBM): Free Stock Analysis Report
 
Southwest Airlines Co. (LUV): Free Stock Analysis Report
 
Las Vegas Sands Corp. (LVS): Free Stock Analysis Report
 
Honda Motor Co., Ltd. (HMC): Free Stock Analysis Report
 
Tesla, Inc. (TSLA): Free Stock Analysis Report
 
ServiceNow, Inc. (NOW): Free Stock Analysis Report
 
Alphabet Inc. (GOOGL): Free Stock Analysis Report
 
Stellantis N.V. (STLA): Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

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