Detailed explanation of the latest US stock market situation including the S&P 500 reaching a new high, outlook for US corporate earnings, and the importance of long term investing (Hatch's US Stock Market Seminar July 2025) | Monex On Demand | Manekuri Monex Securities investment information and media useful for money.

New Highs for the S&P 500 and Stability in the Market Environment

The S&P 500 rose 31.5% from its low on April 7, reaching an all-time high of 6,358.91 points on July 23, with a year-to-date return of 8.1%.

Since June 24, there has been no movement of more than 1%, and the market has shown very stable trends (in the past, there were significant movements 6 times in January and 11 times in April).

The market continues with the VIX index having dropped to 14, amidst a neutral situation where investor sentiment is neither extremely bullish nor bearish.

The Revival of AI-Related Stocks and Government Support

NVIDIA [NVDA] has risen 27% since the beginning of the year, and Palantir Technologies [PLTR] has increased by 104%, indicating a significant recovery in AI-related stocks.

At the Energy Innovation Summit in Pennsylvania, private companies announced an investment of 13.3 trillion yen (92 billion dollars), with President Trump emphasizing leadership in AI technology.

• It has indicated a direction to promote the full utilization of coal, natural gas, nuclear power, and hydropower, as well as deregulation, to secure power for data centers.

Corporate performance has a positive outlook. The S&P 500 target (end of 2025) is 7,000 points.

• The earnings forecast for the second quarter of 2025 is expected to be a 2.5% increase compared to the same period last year, 6.8% for the third quarter, 6.4% for the fourth quarter, and a strong growth of 13% for the first quarter of next year.

In past financial results, the performance has significantly exceeded preliminary forecasts, and it is highly likely that a similar pattern will occur this time as well.

• The target for the S&P 500 is to maintain 7,000 points by the end of 2025, based on the continuous growth of corporate earnings.

The trend of a weaker US dollar is a tailwind for US companies

The US Dollar Index has fallen by 10.4% since the beginning of the year, indicating a weakening of the US dollar.

Approximately 30% of the sales of S&P 500 constituent companies come from overseas, and the depreciation of the US dollar has led to an increase in overseas sales, positively impacting corporate performance.

• Especially positive for Nasdaq 100 constituents with high overseas sales ratios such as Apple [AAPL], Microsoft [MSFT], and Meta Platforms [META].

Subsidies for Research and Development Expenses to MAG7, Alphabet [GOOGL] Reports Strong Earnings

• President Trump's "One Big Beautiful Bill Act" will implement preferential measures for corporate research and development expenses.

Major technology companies will benefit from a total of $75 billion, and their abundant cash flow will further improve.

In Alphabet's [GOOGL] earnings report, search increased by 12%, YouTube by 13%, and cloud by 32%, achieving double-digit growth in all segments year-over-year.

Success Stories of Accumulation Investment and the Importance of Long-term Investment

• The accumulated investment that started in December 2020 has grown to 5.37 million yen from an investment of about 3.2 million yen, achieving a 65% return.

Explaining the importance of continuing without stopping when things go down.

By investing in the future potential of American stocks and continuing to accumulate daily regardless of the Trump administration, long-term returns can be expected.

Investment Value and Signs of Revival for Citigroup [C]

Under the new CEO Jane Fraser, Citigroup [C] has paved the way to achieve a ROTC (Return on Tangible Common Equity) of over 10%.

• Plans to conduct $4 billion in share buybacks in the third quarter, with a continuous plan for shareholder returns equivalent to 10% of the market capitalization.

• It is attractive as a large undervalued bank stock, benefiting from regulatory easing, with a forecast PER of 8.6 times compared to the industry average of 13 times.

Explanation of Notable Stocks and Long-Term Investment Strategy

Boeing [BA] expects a demand for 42,595 aircraft globally by 2044, with a monopolistic situation alongside Airbus and long-term growth anticipated.

• Haiko [HEI] is a leader in the aircraft aftermarket. While the S&P 500 has risen by 594% over the past 25 years, Haiko has increased by 10,411%.

Intuitive Surgical's [ISRG] surgical assistance robot "Da Vinci" has been deployed in over 8,000 units worldwide, providing AI-assisted surgical features.

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