U.S. stocks closed out July on a firmly higher note as investors sorted through a split verdict from the two largest names to report late Thursday. The S&P 500 gained 0.67%, the Dow Jones Industrial Average added 0.38%, the tech-heavy Nasdaq Composite jumped 1.32%, and the small-cap Russell 2000 climbed 1.37%, according to TheStreet's July 31, 2026 market coverage. The month-end rally came despite a fresh push higher in U.S. Treasury yields, which surged to multi-year highs and would ordinarily have pressured richly valued technology shares.
Amazon Delivers a Blowout on AWS
The single largest contributor to Friday's advance was Amazon, whose shares soared roughly 12% to $263.07 after the company reported second-quarter results that comfortably beat expectations on both the top and bottom lines. Revenue landed at $200.6 billion, up 19.6% year over year, and earnings per share came in at $5.75 against a Street consensus of $1.82, per Quartz and 24/7 Wall St.
The standout number was Amazon Web Services, which posted $42.2 billion in revenue, up 37% year over year — the segment's fastest growth rate in 18 quarters. Investors read the acceleration as evidence that the AI infrastructure buildout is still translating into paid cloud consumption rather than tapering, an important marker for the broader capex thesis that has driven semiconductor and hyperscaler valuations for the past year.
Apple Beats, but Guidance Disappoints
Apple, by contrast, could not turn a headline beat into a positive tape. The company posted $109.4 billion in fiscal Q3 revenue, up 16.36% year over year, with iPhone contributing $54.3 billion and Services a record $30.7 billion. Yet shares slid roughly 7% to $307.89 after management guided to 9%–11% revenue growth for the current quarter, short of the 12% Wall Street had penciled in.
24/7 Wall St. attributed the reaction to a combination of the softer forward outlook, rising component costs and slowing growth in key segments. Bank of America pushed back on the bearish read in a client note, reiterating a $380 price target and arguing the guidance reflects a supply constraint rather than a demand problem. Wells Fargo lifted its target to $350 from $310. Others moved the other way: Barclays cut to $245 (Underweight) from $253, Goldman Sachs trimmed to $360 from $370, and Morgan Stanley eased to $360 from $364.
Yields Climb, but Bid Holds
The move higher in Treasury yields — Bloomberg described the rise as pushing to multi-year highs — normally acts as a headwind for long-duration technology names, but the AWS print and a broader relief bid across cyclicals were enough to override that pressure on Friday. The Russell 2000's 1.37% gain, outpacing the S&P 500, suggests some of the flow rotated down the market-cap spectrum, a pattern that has appeared periodically during recent bouts of yield strength.
What to Watch Next Week
With the mega-cap earnings crescendo now largely behind the market, attention shifts back to macro. Traders will be watching next week's economic data for confirmation that the Federal Reserve's decision earlier this week to hold policy steady is still supported by cooling inflation, and whether the yield backup at the long end signals fresh concern about term-premium or simply positioning. For now, the message from Friday's close is that a genuine earnings surprise — AWS at +37% — is still enough to power the tape through a difficult rates backdrop.
Sources: TheStreet, CNBC, Bloomberg, 24/7 Wall St., Quartz, Yahoo Finance