August 28th Pre-Market Brief

Good Morning

Quiet morning to close out the week, with tech giving back a little after Marvell beat and got sold off. Everyone is just waiting on Warsh at ten, he is the one Fed chair who has made a habit of not telling you much. Options pricing in little implied volatility for the event..

Let's dig in...

Today's Big Picture

1. The Market Is Priced For Warsh To Say Nothing

Warsh speaks at ten and has declined to give forward guidance since taking the job in May. The thirty-year yield sits near five point two, close to its highest level since 2007, and the VIX is under fifteen. Three Fed officials warned on inflation Thursday, and Boston's Susan Collins said she could support a hike if the data disappoint. Stocks are positioned for a quiet speech, so silence lands in the long end before it lands anywhere else.

2. One Sector Carried Thursday

Information technology gained three point four percent Thursday while the other ten S&P sectors closed lower, the widest split with tech alone in the green since March 2001. This morning Marvell beat on revenue and earnings and is down more than eight percent, because its gross margin forecast came in at the bottom of the range the Street wanted. Bank of America, UBS, Barclays, Wells Fargo and Citi all kept bullish ratings anyway. The index sits within one percent of a record on the back of a single sector, and that sector just sold a beat.

3. Grains Broke Out While Everyone Watched Jackson Hole

Wheat and corn touched their highest levels since July 2023 this morning, and soybeans reached a near three-year high. Attacks in the Black Sea have halted nearly all grain shipments through ports that handled about seventy percent of Russian exports. Wheat is up more than half this year and better than twenty percent in the past month alone. Trump then went after the meat processors on Truth Social, moving to let ranchers process their own beef, which pushed Tyson and JBS lower before the bell.

Market Overview

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Stock Spotlight (pre-market)

PayPal $PYPL ( ▼ 0.55% )  
is sharply lower after Bloomberg reported that Stripe and Advent International abandoned their pursuit of the company. The stock had gained roughly thirty percent since the approach was first reported, and that premium is coming out this morning.

Affirm $AFRM ( ▲ 1.35% )  
is higher after fiscal fourth-quarter revenue of one point one seven billion dollars beat the one point one one billion estimate. First-quarter revenue guidance also came in above the Street.

Marvell Technology $MRVL ( ▼ 1.49% )  
is lower despite beating on revenue and earnings and lifting its revenue outlook to around eighteen billion dollars. The stock is down on a current-quarter gross margin forecast of fifty-seven and a half to fifty-eight and a half percent, against a consensus at the top of that range. Shares are still up one hundred eighty-four percent this year.

Gap $GAP ( ▼ 1.7% )  
is higher after adjusted earnings of fifty-two cents beat the forty-eight cent estimate and the company raised its profit outlook. Michael Francis takes over Old Navy on November second, replacing Haio Barbeito. Gap also cut its sales outlook on continued weakness at the brand.

Nvidia $NVDA ( ▲ 8.74% )  
is slightly lower, giving back a piece of Thursday's four hundred forty-two billion dollar gain in market value, its steepest climb in a year. Raymond James raised its target to five hundred fifty dollars from three hundred fifty-two, against a Street average near three hundred six.

Micron Technology $MU ( ▼ 2.3% )  
is lower with the chip group, alongside Intel, Sandisk and Lumentum. Chinese rival CXMT reported its first results as a public company this morning, showing memory sales climbing as AI demand lifts prices.

What to Watch

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The Thirty-Year Yield (After Ten)
The thirty-year sits near five point two, just off its highest level since 2007. Bank of America says a speech confined to structural themes pushes it toward five and a half. Treasury doubles its weekly buybacks September ninth, so a scheduled buyer is already waiting if the long end runs.

Broadcom Reports Wednesday
Broadcom closes the season at a market value above one point seven trillion dollars. Nvidia gave a full-year forecast and got paid. Marvell missed on one margin line and got sold. Dell and Palo Alto Networks follow, three reads on data center spending before the Fed meets.

August Jobs Report (September 4th)
Payrolls are seen rising about forty-five thousand with unemployment near four point two, after July fell by twenty-three thousand. Futures put September hike odds near one in three. A firm print with wage growth lifts that, a soft one keeps the Fed parked.

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