Most Stocks Rise as Warsh Says Price Risks Fading | Closing Bell
Most stocks rose on the first trading day of July, though markets experienced a slight sell-off into the close. Fed Chair Kevin Warsh indicated inflation risks are fading. Major movers included Meta Platforms surging 9% on AI infrastructure plans, Microsoft bouncing back 3% after June losses, and semiconductor stocks declining sharply amid competition concerns.
Summary
The Closing Bell team opened coverage of the first trading day of July and the start of the second half of the year. Overall market performance was mixed: the S&P 500 finished down 0.2%, the Nasdaq composite down 0.6%, and the Dow Jones essentially flat. The Russell 2000 also declined slightly. On a sector basis, communication services and financials showed strength, while information technology, utilities, and industrials experienced weakness. Of 500 S&P companies, 299 traded higher while 204 traded lower.
The semiconductor sector was notably weak, with the Philadelphia Stock Exchange Semiconductor Index (SOX) down 6.2%. This decline was partially attributed to news that Apple is considering purchasing Chinese-made memory chips, a move that pressured Micron shares down 10% to session lows while Apple itself rose 1.5%. The potential for increased competition from Chinese chip makers added to negative sentiment in the sector.
Major gainers included Meta Platforms, which surged nearly 9% (up 11.5% at intraday highs) after Bloomberg reported the company is developing plans for a cloud infrastructure business to sell access to AI computing power and models, competing with Amazon Web Services and Google Cloud. This represents Meta's effort to justify massive spending on data center buildout by monetizing excess capacity. Microsoft also rebounded strongly, up 3% on its first trading day of July after suffering a 17% decline in June due to AI-related concerns. The company announced plans for thousands of layoffs while increasing AI spending.
Notable decliners included Coreweave, down 14%, as its core business of providing AI computing infrastructure faced direct competition from Meta's new initiative. Nvidia, Applied Materials, and a semiconductor ETF were also shorted by Michael Berry, the investor famous for betting against the 2008 housing market. Caterpillar fell 6.9% after Berry disclosed short positions. Walmart declined nearly 4% to its lowest close since November 2025, extending a six-day losing streak amid slowing quarter-over-quarter trends reported by Cleveland Research.
Fed Chair Kevin Warsh spoke earlier in the day stating that price risks are fading, though this had minimal market impact as investors await the jobs report scheduled for Thursday. The transcript concludes with extended banter about Taylor Swift potentially getting married at Madison Square Garden on July 2nd or 3rd, with speculation about whether it's a wedding or a concert.
Key Insights
- Carol Masser notes the Philadelphia Semiconductor Index is down 6.2% due to intense selling, with semiconductors being a volatile sector that has experienced significant ups and downs recently
- Meta Platforms is developing a cloud infrastructure business to sell access to AI computing power and models to compete with Amazon Web Services and Google Cloud, partly to justify spending on data center buildout
- Microsoft is planning to announce layoffs of less than 2.5% of its 220,000-person workforce while simultaneously increasing spending on AI
- Michael Berry, known for his 2008 housing market bets, has shorted Caterpillar, Nvidia, Applied Materials, Tesla, and a semiconductor ETF, describing the SOX as a pure form of overvaluation
- Walmart shares have declined 20% from June highs and fallen for six consecutive days, with analysts uncertain about whether this represents the bottom and questioning if executives should make strategic announcements
Topics
Transcript
[0:00] Two minutes away from the end of the trading day. Katie Greifeld and Bailey Lipschultz is in for Romain [music] Bostick here to help take us through the closing bell. We're joined by a global simulcast [music] Carol Masser and Tim Stenovec. We bring together all of our various audiences to talk about the first trading day of July. Carol Masser, a month which is pretty good for the equity bulls but a little bit of a sell-off into the close. >> Yeah, absolutely. But I got to say not a great start to the third quarter or the second half for semiconductors. The [0:31] Philadelphia Stock Exchange Semiconductor Index the SOX, it is down about 6.2% as we…
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