Tuesday, May 20, 2025

Market indexes started the trading day in the red and remained pretty steady through most of the day. A fake-out sell-off in the final hour ramped higher into the close, but only the small-cap Russell 2000 made it into the green. The Dow slipped -114 points, -0.27%, while the S&P 500 snapped its six-day winning streak, -0.39%. The Nasdaq dropped -72 points, -0.38%, and the Russell gained 1 point on the session, +0.05%.

We didn’t see any economic prints today, nor did we hear any news on tariff deals. However, with congressional Republicans putting together the “big, beautiful bill” President Trump desires to sign into law, concerns over extending the deficit by trillions of dollars based on proposed massive extended tax cuts are emerging. The U.S. credit rating has already been docked by the three major credit agencies.

Also, this “V-shaped recovery” seems to have little place to go currently, especially without any major trade deals locked in and a 90-day suspension of reciprocal tariffs ticking away. Major indexes are all up double-digits over the past month of trading — even higher from the April 8th lows before the tariff suspensions were enacted. Though only the Dow and S&P 500 are in the green year to date, all these indexes are now up from a year ago.

Earnings Results After the Closing Bell

Cybersecurity major Palo Alto Networks PANW posted mixed results in its fiscal Q3 report after Tuesday’s close, coming up 2 cents short on earnings to 39 cents per share, a nickel below the year-ago earnings tally. Revenues of $2.3 billion in the quarter narrowly outperformed the Zacks consensus, amounting to +15% gains year over year. Shares are acting erratically in late trading, even with upward guidance in next quarter earnings and full-year revenues. (You can see the full Zacks Earnings Calendar here.)

Luxury homebuilder Toll Brothers TOL posted big beats in its fiscal Q2 this afternoon, with earnings of $3.50 per share swooping past the $2.86 in the Zacks consensus on $2.71 billion in revenues, which easily surpassed the $2.50 billion analysts were looking for. The housing shortage continues, although the luxury market stays relatively healthy. Adjusted Gross Margins were in-line, Deliveries were up and Signed Contracts were -13%. Shares are up +5% in late trading.

What to Expect Tomorrow in the Stock Market

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

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