Markets

Daily Market Briefing

TL;DR

CPI relief rally continues—inflation cooled to 3.4% and AI bellwethers crushed it. S&P flirting with records, Fed rate cut odds at 85% for September. Today's PPI print will either cement the narrative or throw cold water on it. Watch Applied Materials after the bell for the next AI demand signal.

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MARKET SNAPSHOT

US Futures (8:00 AM ET)

• S&P 500: +0.08% (testing record territory)
• Nasdaq 100: +0.13% (AI momentum continuing)
• Dow: -0.05% (lagging as megacap tech leads)
• Russell 2000: +0.14%

Asia Close

• Nikkei 225: 67,515 (+1.24%) — caught the Wall Street updraft
• Hang Seng: +0.6% — modest bounce amid property concerns
• Shanghai Composite: +0.3% — stimulus hopes alive

Europe (Early Trading)

• FTSE 100: +0.4%
• DAX: +0.5%
• CAC 40: +0.3%

Key Levels

• 10-Year Treasury: 4.68% (down from 4.72% after CPI)
• VIX: 15.21 (+2.1%) — calm but ticking up slightly
• WTI Crude: $80.71 (+3.2%) — Iran tensions keeping floor under prices
• Brent: $86.21 (+3.2%)
• Gold: $4,381 (-0.4%) — easing as risk-on returns
• Bitcoin: ~$64,600 (-0.9%)

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TODAY'S CALENDAR

8:30 AM ET

• Producer Price Index (PPI) — The big one. After yesterday's benign CPI, a tame PPI would complete the inflation relief narrative and cement September rate cut expectations. Consensus: +0.2% MoM
• Weekly Jobless Claims — Watching for any cracks in labor market

10:00 AM ET

• JOLTS Job Openings (June)

Earnings After Close

• Applied Materials (AMAT) — THE tell on semiconductor equipment demand. Street expects $3.36-3.39 EPS, ~$9B revenue. Management already raised calendar 2026 semi equipment growth outlook to 30%+. This is your AI infrastructure capex thermometer.
• Deere (DE) — Ag economy health check
• Tapestry (TPR) — Consumer discretionary signal

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TOP 5 HEADLINES

July CPI came in at 3.4% year-over-year, down from 3.5% in June. Monthly reading was +0.1%, rebounding from a -0.4% decline in June. The Fed's getting what it wanted. Why it matters: Market now pricing 85% probability of a September rate cut (25 bps). The "soft landing" narrative is back in the driver's seat. Bond yields dropped, stocks rallied. Simple as that.

The AI demand story isn't slowing down. CoreWeave raised full-year guidance to $12.4-13.2B in revenue (street was at $12.63B) and sees $960M-$1.15B in adjusted operating income. The stock surged 20% premarket. Super Micro beat Q4 estimates. Cisco forecasted upbeat annual revenue on "sustained AI spending." Why it matters: Every AI infrastructure bellwether is singing the same tune—demand is robust, visibility is improving. This is why Nasdaq hit a one-month high yesterday.

The S&P 500 is within striking distance of all-time highs after yesterday's 0.3-0.5% gain. That's 25 all-time highs in 2026 so far—the seventh-best start in 33 years. The Nasdaq 100 gained 0.9% and is leading the charge. Why it matters: Market breadth improving alongside tech leadership is the healthy kind of rally. The August pullback everyone expected hasn't materialized.

Pakistan's defense minister said Washington and Tehran are "close to some sort of arrangement" on reopening the Strait of Hormuz. Oil prices remain elevated but off recent highs as the market tries to price in the odds of de-escalation. Why it matters: Oil's been a wildcard all year with Strait disruptions. Any breakthrough could send crude back toward $70—which would be another inflation tailwind. Worth monitoring but not trading on headlines. 📧 Flag for client communication if deal materializes

Markets have shifted dramatically from pricing in rate hikes to expecting cuts. CME FedWatch shows 85% odds of a September 25bp cut. Morgan Stanley expects the Fed to stay on hold as inflation moderates. Why it matters: The rate cut trade is getting crowded. If today's PPI surprises hot, or if the Iran situation escalates, the repricing could be swift. Don't assume September is a done deal.

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