August 20th Pre-Market Brief

Good Morning

Yesterday the bond market liked what Treasury had to say. This morning it changed its mind.

Walmart's numbers are interesting. Its fastest growth is coming from six-figure households while CFO says its lower-income shoppers cut back on necessities.

Bitcoin over $71,000 is interesting because this crypto rally came right aside with the precious metals bounce over past week or so.

Let's dig in...

Today's Big Picture

1. The Data Undercut The Buyback Before The Open

Yields were already climbing overnight. Then Philadelphia Fed manufacturing printed 47.4 against 25 expected, the highest since April 2021, with its employment gauge the best since April 2022. Jobless claims fell to 206,000 against 210,000 expected. July minutes showed several officials ready to raise rates, and Treasury just started easing into an economy that is speeding up.

2. Walmart Raised Guidance And Still Came In Under The Street

Full-year adjusted earnings guidance went up to $2.80 to $2.87. Consensus was $2.90. Third quarter guidance of 62 to 64 cents landed under the 68 cents expected. That's why a beat on revenue and earnings is trading down six percent.

3. Tech Is Outbidding Treasury For The Same Buyer

Treasury's larger buyback works out to roughly $128 billion of long bonds a year. Companies have raised $309 billion in investment-grade debt for AI this year, most of it from Alphabet, Amazon, Meta, Microsoft and Oracle, and that is more than double all of 2025. Both draw from the same pool of fixed-income money. Bessent controls one side of that and has no say over the other.

Market Overview

Today’s Sponsor

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Stock Spotlight (pre-market)

Advance Auto Parts $AAP ( ▼ 1.37% )  
Comparable sales came in negative against expectations for a gain, and full year sales guidance was reaffirmed below what analysts wanted.

Strategy $MSTR ( ▲ 12.68% )  
Moving with Bitcoin, which is above $71,000 and back over $70,000 for the first time since June 2. Two catalysts stacked into this the Treasury buyback pushed yields down Wednesday, and Trump pressed Congress to pass crypto legislation at a White House meeting the same day.

Moderna $MRNA ( ▲ 176.97% )  
Giving back part of yesterday's 177 percent gain, the largest single session move for an S&P 500 stock in twenty five years. The melanoma vaccine trial with Merck hit its primary and secondary goals, but neither company disclosed how much longer patients went without recurrence.

Alibaba $BABA ( ▲ 0.59% )  
Net income fell 75 percent to about $1.6 billion. Revenue rose 9 percent and cloud revenue rose 45 percent, so the miss is cost, not demand.

Deere $DE ( ▼ 1.37% )  
Earnings came in at $5.10 a share against $4.69 expected. Roughly 30 cents of that came from $110 million in tariff refunds. Large farm equipment sales fell 6 percent with operating profit down 9 percent, while construction and forestry sales rose 18 percent and profit rose 84 percent.

Coty $COTY ( ▲ 10.58% )  
Reported a wider quarterly loss than expected and guided for a sales decline in the current quarter. Revenue beat.

What to Watch

Want to Know about this years upcoming IPO’s?
MarketBeat did an excellent job on this free IPO guide on IPO’s happening this year

Walmart CFO On CNBC (10:00 AM ET)
Rainey said executives are discussing whether to report store-fulfilled online orders differently, calling the current comp a legacy fixation. If the largest retailer redefines comparable sales, every retail comparison this season gets harder to read. Listen for whether he attaches a timeline to it.

Trump Policy Meeting (11:00 AM ET)
The threat is public, the enforcement list is not. Secondary sanctions only bite once a specific bank, port, exchange house or ship registry gets named. Tankers, refiners and shipping insurers trade on the names, not the announcement

Today’s Sponsor

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Using Roku Ads Manager, the campaign moved from a pilot to a permanent performance engine for the brand.

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