Hey there! Happy Monday from The Street Sheet. Ready to start a new week of trading off strong? Here’s everything you might have missed last week on Wall Street, and everything to watch in the week ahead.

Markets retreated from all-time highs as tariff turbulence and softening jobs data spooked investors. On the week, the Nasdaq Composite, the S&P 500, and Dow Jones Industrial Average fell 2.17%, 2.36%, and 2.92%, respectively.

While almost every sector trended lower, the Utilities Select Sector SPDR Fund (XLU) gained 1.51%. This may mean a flight to safety — especially as the 10-Year Treasury Yield fell by 18 basis points. 

On the surface, markets had much to cheer. The Commerce Department reported that the US economy expanded sharply, with an annualized growth rate of 3% in Q2. This was significantly higher than the 2% that economists predicted, and splashed cold water on recessionary fears. 

Consumer spending also rose by 1.4% after sputtering in Q1. And some of the biggest US companies delivered earnings beats, including Apple $AAPL ( ▼ 0.3% ), Meta $META ( ▼ 2.27% ), and Microsoft $MSFT ( ▼ 0.59% ).

But tariff uncertainty continued to weigh on markets. For every new trade agreement — like the US-EU deal announced Monday — there were many more question marks, particularly after President Trump again delayed the deadline to Aug. 7. 

The July jobs report released on Aug. 1 also showed weakness, with just 73,000 new jobs created in July, while the totals for May and June were revised downward by a whopping 258,000. 

That came after the Federal Reserve once again held the federal funds rate steady at 4.25%-4.5% range on Wednesday. In remarks following the decision, Fed Chair Jerome Powell called the labor market “solid.” 

But two Fed members, Chris Waller and Michelle Bowman, disagreed. Their two votes to lower rates meant the FOMC vote was more divided on a rate decision than it has been since 1993.

On Wednesday, Fed Chair Jerome Powell suggested that it will be several months before he’s ready to conclude whether or not tariffs are causing the elevated inflation that precludes lower interest rates. 

But the 1913 law creating the Federal Reserve gave the institution another mandate: helping to ensure maximum employment. If the labor market shows more signs of weakness following July’s jobs report, the Fed may feel compelled to act. The initial jobless claims report, scheduled for Thursday, will offer the first hint.

Additionally, next week will mark the mid-point of earnings season. All of the “Magnificent Seven” companies have reported earnings except for Nvidia $NVDA ( ▲ 0.87% ), due late August. 

To date, roughly 80% of S&P 500 companies have beaten earnings expectations. We’ll be watching to see if the trend holds as a slew of oil and gas companies report earnings in the week ahead, including Exxon Mobil $XOM ( ▲ 0.22% ) and Chevron $CVX ( ▼ 0.79% ).

Elsewhere, the S&P final US Services PMI numbers for July will be released on Tuesday, providing an update on service sector business activity. After the business activity index slowed in June, we’ll be watching to see if the index can notch its 30th straight month of expansion.

We’ll also be watching Atlanta Fed President Raphael Bostic’s speech, scheduled for shortly after initial jobless claims numbers are due on Thursday morning. At the Fed’s recent FOMC conference, Bostic agreed with the consensus to hold rates steady. We’ll see if his remarks hint at any softening of his position, given the weak jobs data seen since.