August 11th Market Overview

Happy Monday

Quiet day ahead of tomorrow's inflation data, but the Nvidia and AMD news is wild. Never seen Washington literally take a cut of private company revenues like this before.

15% of their China chip sales just to get export licenses. 

Sets a pretty nasty precedent imho.

Market's kinda shrugging it off though, more focused on whether Powell's gonna cut rates next month than celebrating any trade progress.

Let's dig in...

Summary

Inflation Data Tomorrow 
Tuesday's Consumer Price Index expects headline inflation at 2.8% and core at 3.1%. Goldman Sachs warns consumers will absorb 67% of new tariff costs, potentially pushing core PCE to 3.2% by December.

Government Revenue Grab Nvidia 
$NVDA ( ▲ 0.87% ) and $AMD ( ▼ 0.77% ) will give Washington 15% of AI chip sales revenue to China in exchange for export licenses. First time the government has directly claimed private company revenues as trade policy.

Tariff Deadline Extended Trump 
pushed China tariff deadlines to November 9, buying 90 days for negotiations. Removes immediate escalation risk but trade tensions remain unresolved.

Market Overview

U.S. Stock Indexes, Past Three Sessions

Stock Spotlight

C3.ai $AI ( ▲ 1.96% ) guided Q1 revenue at $70.2-70.4 million versus $104 million consensus. The company announced a sales reorganization. D.A. Davidson cut to Underperform with a $13 target, warning "it gets worse before it gets better."

Micron Technology $MU ( ▲ 2.22% ) raised Q4 revenue guidance to $11.2 billion from $10.7 billion. The memory maker now expects EPS around $2.85 versus $2.50, driven by stronger DRAM pricing.

Intel $INTC ( ▼ 3.66% ) gained as CEO Lip-Bu Tan met with Trump at the White House after criticism over his China ties. The meeting aimed to stress Intel's national security role.

Big Name Updates

Apple $AAPL ( ▼ 0.3% ) is developing an entry-level MacBook priced around $599-699 with an A18 Pro chip. Launch targeted for late 2025, potentially boosting MacBook volumes 30-40%.

Tesla $TSLA ( ▲ 1.39% ) continues expanding robotaxi coverage in Austin as the company builds out its autonomous network ahead of broader deployment.

Adobe $ADBE ( ▲ 0.67% ) faced a Melius Research downgrade to Sell with a $310 target. The firm cited "AI is eating software" pressuring traditional SaaS companies.

Other Notable Company News

$WEED ( ▲ 7.38% ) gained on reports Trump is considering reclassifying marijuana from Schedule I to Schedule III.

Coinbase $COIN ( ▲ 1.0% ) benefited from Bitcoin nearing $120,000, supported by Trump's executive order easing retirement account crypto investments.

CrowdStrike $CRWV ( ▼ 3.17% ) received a JPMorgan price target double to $135 from $66 on strong growth and AI opportunities despite high debt.

GameStop $GME ( ▲ 0.74% ) boosted executive compensation with $1.65 million in restricted stock units for Daniel Moore, vesting through July 2027.

Sector Watch

Bond Market

The 10-year Treasury yield held steady at 4.280% as traders positioned ahead of inflation data. JPMorgan warned tariffs are pushing goods prices higher while consumption slows → a recipe for stagflation.

• Bond markets are pricing reduced Fed easing as inflation concerns mount

• Any CPI surprise tomorrow could push yields significantly higher

• Rate-sensitive sectors remain vulnerable to sticky inflation

Policy Watch

Trump extended China tariff deadlines by 90 days to November 9th, buying time for negotiations and a potential Xi Jinping meeting this fall. The president also declared "Gold will not be Tariffed," ending speculation that drove record highs last week.

• Trump urged China to quadruple U.S. soybean purchases, sending Chicago soybean futures up in the biggest intraday jump in four months
  

• The Bureau of Labor Statistics faces scrutiny after Trump fired head Erika McEntarfer following weak jobs data
  

• Ford $F ( ▲ 0.18% ) announced a $2 billion investment in a Louisville assembly plant focused on cheaper electric vehicles
  

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What to Watch

Tuesday's CPI Report at 8:30 AM ET 
Hot inflation could derail September rate cut hopes and pressure rate-sensitive sectors. Goldman Sachs projects core PCE hitting 3.2% by December if tariff patterns continue.

Cannabis Regulatory Momentum 
Trump is considering marijuana reclassification from Schedule I to Schedule III, which could unlock banking and tax benefits for the industry.

Nvidia Revenue-Sharing Precedent 
Watch for government revenue claims expanding to other tech companies with China exposure. This model could alter profitability calculations for multinationals.

China Trade Negotiations 
Despite 90-day extension, tensions remain unresolved. Watch for Xi-Trump meeting signals ahead of the November 9 deadline.

Fed Chair Speculation 
Bloomberg reported expanded candidate lists including governors Michelle Bowman and Philip Jefferson alongside front-runners Kevin Warsh and Kevin Hassett.

Thanks for reading 🙂

- John

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