Stocks closed mixed yesterday, but the S&P and Nasdaq, once again, eked out new all-time highs in the process. That puts the S&P up 6 days in a row, and the Nasdaq up 5 out of the last 6 days. In fact, the Nasdaq has been higher in 10 of the last 11 trading days.

Word on Sunday that the U.S. and the E.U. signed a trade deal, averting a trade war, was cheered. Even though gains were muted yesterday, the importance of a deal cannot be overstated between the two countries, who are each other's largest trading partner.

That comes on the heels of last week's deal with Japan, who is our fifth largest trading partner.

But the August 1^st deadline is fast approaching. Negotiations continue with our second and third largest partners Mexico and Canada.

And talks with China (fourth largest trading partner) continues in Stockholm, Sweden this week. But that deadline isn't until August 12^th.

In the meantime, it'll be a busy week of reports this week. Both economic reports and earnings reports.

On the economic front, we'll get the FOMC Announcement on Wednesday. While nobody is expecting the Fed to cut rates this week, everyone will be listening for clues on whether they are closer to cutting at their next meeting in September or not until the following one in October. With the Fed still expecting 2 rate cuts this year and only 4 meetings left (including Wednesday's), half of the remaining meetings should result in rate cuts.

We'll get the advance estimate on Q2 GDP on Wednesday as well. Q1, you'll remember, came in at -0.5% (which was heavily skewed due to a rush of imports into the U.S. to beat the increase in tariffs -- an increase in imports vs. exports can depress GDP numbers). But Q2 is expected to come in at 2.5%. If so, that should quash the misguided recession worries once and for all.

We'll also get another look at inflation on Thursday with the Personal Consumption Expenditures (PCE) index, which is the Fed's preferred inflation gauge.

And on Friday we'll get the always important Employment Situation report.

As you know, the Fed has a dual mandate of maximum employment and price stability, i.e., low inflation. We'll see how both are shaping up by week's end.

But, we already know how it's been going. Fed Chair Jerome Powell has noted the progress made on inflation. And in spite of the Fed's worries over inflation ticking up due to tariffs, it's actually gone down over the last several months. As for jobs, Mr. Powell said, "the economy is in a solid position, the unemployment rate remains low, and the labor market is at or near maximum employment."

We've also got a big week of earnings with another 845 companies on deck to report over the remainder of the week, including 4 more Magnificent 7 stocks with Microsoft and Meta going on Wednesday after the close, and Apple and Amazon going on Thursday after the bell as well.

If we can continue the streak of better-than-expected earnings, better-than-expected inflation, and better-than-expected jobs, we could see stocks breakout to even higher highs.

See you tomorrow,