August 21st Market Overview

Happy Thursday

Market feels stuck between wanting rate cuts and dealing with reality. Fed minutes basically said "we're more worried about inflation than jobs" making September cuts less certain imo. Even Walmart couldn't dodge tariff costs despite crushing sales.

AI trade is getting shaky near highs. Meta froze hiring, big tech names fell again.

Tomorrow Powell speaks at Jackson Hole. Last year he practically promised cuts. This year feels different. A’lotta anticipation on what the fella has to say.

Let's dig in...

Today's Big Picture

Fed worried about inflation over jobs Minutes show most officials prioritize rising prices over unemployment. September rate cuts now look unlikely.

Walmart can't escape tariff costs Beat sales estimates but missed earnings for first time since May 2022. CEO said tariffs will hurt second-half profits despite raising guidance.

Tech selling spreads All eight trillion-dollar stocks fell again. Meta stopped AI hiring after months of expanding those teams. The AI boom is getting tested.

Powell speaks Friday at Jackson Hole Last year he hinted at rate cuts. This year inflation worries likely will muddy his message.

Market Overview

U.S. Stock Indexes, Past Three Sessions

Stock Spotlight

Nvidia $NVDA ( ▲ 1.79% ) 
price target raised to $205 by UBS on strong chip demand. China wants 70% AI chip independence by 2027, creating long-term competition, but H20 license approval helps near-term.

Target $TGT ( ▲ 2.32% ) 
fell after naming insider Michael Fiddelke as new CEO. Analysts question if a company veteran can fix the struggling digital operations.

Walmart $WMT ( ▼ 1.12% ) 
missed earnings for first time since May 2022. Revenue hit $177.4B beating estimates, but profit of 68¢ fell short of 74¢ expected. CEO said tariffs will hurt second-half results despite raising outlook.

Big Name Updates

Apple $AAPL ( ▲ 1.44% ) 
opening new Bangalore store September 2nd, adding to Mumbai and Delhi locations in India expansion.

Boeing $BA ( ▲ 2.97% ) 
nearing deal with China for up to 500 jets, potentially ending sales freeze since 2017. Plane orders becoming key part of trade talks.

Meta $META ( ▲ 2.06% ) 
fell on reports it froze AI hiring after months of expanding those teams. Company called it routine planning but timing suggests spending pullback.

Johnson & Johnson $JNJ ( ▲ 0.26% ) 
investing $2B over next decade in North Carolina drug manufacturing, adding 120 jobs as Trump weighs pharmaceutical tariffs.

Other Notable Company News

CoreWeave $CRWV ( ▲ 3.76% ) 
upgraded to Buy with $180 target. Jane Street disclosed stake in the AI infrastructure company.

Instacart $CART ( ▼ 1.85% ) 
downgraded on Amazon same-day delivery competition. Analysts expect the company to lose customers as Prime gets more attractive.

First Solar $FSLR ( ▲ 4.68% ) 
and Sunrun $RUN dropped after Trump said no new solar or wind project approvals.

Solar ETF $TAN ( ▲ 5.25% ) fell as Burgum takes control of permits.

Energy Fuels $UUUU ( ▲ 12.18% ) 
produced first kilogram of rare earth dysprosium at Utah mill. Company targets 15 kg before switching to terbium in Q4, with full production planned for late 2026.

Sector Watch

Bond Market

Treasury yields jumped after Fed minutes showed officials worry more about inflation. European and Japanese yields also rose, with Japan's 20-year hitting a 26-year high.

Bond traders now think September rate cuts are less likely. Higher yields hurt utility and real estate stocks but help banks make more money on loans.

10y Yield at 4.331%

Policy Watch

Jackson Hole symposium begins Thursday Fed Chair Powell speaks Friday 10 AM with rate cut expectations hanging in the balance. Last year he used the platform to signal cuts were coming. This year's speech carries higher stakes.

US-EU trade framework details released

• Auto tariffs stay at until Europe reduces levies on US goods

• Broader tariff applies to most EU goods

• Exemptions for unavailable natural resources and aircraft

• Alcoholic beverages stay taxed despite EU lobbying

China investment pipeline South Korea expects to announce $150B in US investment commitments during President Lee Jae Myung's August 25 Trump summit, following the playbook of using large investment promises to improve trade relations.

Key dates ahead: August 29 PCE data, September 5 jobs report, September 17 Fed decision

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What to Watch

Powell speaks Friday at Jackson Hole Fed Chair addresses the annual symposium at 10 AM. Last year he signaled rate cuts were coming. This year inflation worries could keep him cautious.

August 29 PCE inflation data The Fed's preferred inflation measure could show if price pressures are actually cooling or just taking a breather.

September 5 jobs report Employment data will help determine if the Fed cuts rates September 17 or waits longer.

Trump-South Korea summit August 25 Lee Jae Myung expected to announce $150B in US investment pledges, continuing the pattern of using big investment promises to improve trade relations.

Thanks for reading 🙂

- John