Market Update

The S&P 500 index has seen a modest rise today, with an increase of 0.13%. Similarly, the Dow Jones Industrial Average grew by 0.19%, while the Nasdaq 100 index reported a slight uptick of 0.04%. The September e-mini S&P Futures and e-mini Nasdaq Futures recorded increases of 0.14% and 0.05%, respectively.

In the inventory sector, there was a recovery from earlier losses, largely fueled by stronger-than-expected software inventory. MongoDB led the charge with a remarkable 32% surge following a boost in its 2026 adjusted EPS forecast. Meanwhile, market activity is subdued as investors await NVIDIA’s upcoming revenue report, which could provide fresh insights into the artificial intelligence market. Given its market cap of $4.4 trillion, Nvidia accounts for approximately 8.1% of the S&P 500, making its impact significant.

Bond profits have been constrained as yields on government bonds rise. The yield on ten-year T-notes has increased slightly by 2 basis points to 4.28%. The semiconductor market continues to struggle, affecting technology stocks and the broader market.

Comments from New York Federal Reserve President Williams were neutral today, indicating a slowing US economy but offering an optimistic outlook. He mentioned that future FOMC meetings will be “live” discussions, hinting that interest rates could eventually be adjusted downward while maintaining a conservative approach.

Mortgage applications in the US dropped by 0.5% in the week ending August 22nd, with the purchase mortgage subindex rising by 2.2% and the refinance subindex declining by 3.5%. The average rate for a 30-year fixed mortgage slightly increased from 6.68% to 6.69%.

In tariff-related news, President Trump issued threats about imposing new tariffs on advanced technologies and semiconductors in response to digital service taxes affecting American companies. Last week, he expanded tariffs on steel and aluminum to cover over 400 consumer items. These changes took effect last Monday and included items already in transit.

More recently, Trump extended a tariff ceasefire with China for an additional 90 days until November. Moreover, he announced a doubling of tariffs on US imports from India due to the purchase of Russian oil. Bloomberg Economics anticipates that the announced fees could elevate tariffs significantly over the next few years.

This week, the focus will be on new tariff developments and any updates concerning the Ukraine-Russian war. Market attention will also shift towards Nvidia’s quarterly revenue announcement. Additionally, revisions to second quarter GDP are expected to show an increase to 3.1%. Initial unemployment claims may range from 230,000 to a reduction of 5,000 during the week. Personal spending is anticipated to rise by 0.3% in July, with personal income expected to grow by 0.4% in the same month.

The Core PCE price index for July, favored by the Fed as an inflation measure, may see an increase of 0.2% month-over-month and 2.9% year-over-year. Furthermore, the MNI Chicago PMI is likely to drop to 46.5, with the University of Michigan’s Consumer Sentiment Index anticipated to remain at 58.6.

Futures pricing indicates an 87% likelihood of a 25 basis point rate reduction at the next FOMC meeting on September 16-17, while there’s a 52% chance of another rate cut by the next meeting on October 28-29.

Regarding revenue reports, the second quarter for S&P 500 companies revealed an impressive year-over-year revenue growth of 9.1%, significantly above the earlier prediction of 2.8%. Approximately 82% of companies reported better-than-expected earnings as the second quarter revenue season concluded.

Overseas stock markets presented a mixed bag today. The Euro Stoxx 50 rebounded slightly from its two-week low, while China’s Shanghai Composite fell by 1.76%, and Japan’s Nikkei 225 gained 0.30%.

Interest Rates

T-note prices for September saw a reduction of four ticks, with a current yield of 4.275%, reflecting an increase of 1.4 basis points. Rising inflation expectations have resulted in slight declines in T-Notes as the break-even inflation rate reached a six-month high today at 2.453%. The Treasury is set to auction various bonds, adding supply pressures to the T-note market. Additionally, internal pressures concerning Fed governance have raised investor anxieties about the Fed’s independence amid potential inflation issues.

European government bond yields are also trending downward, with Germany’s decade yield dropping to 2.695%, its lowest in a week and a half.

The German Consumer Trust Survey unexpectedly fell to a five-month low, indicating weaker consumer sentiment. Currently, there’s only a minimal chance of a rate cut by the ECB at its upcoming meeting.

US Stock Movers

MongoDB reported a Q2 adjusted EPS of $1.08, surpassing the consensus estimate and leading to over a 32% rise in stock value as a result of an improved EPS forecast for 2026. Atlassian also saw a rise of more than 4%, becoming one of the top performers on the Nasdaq 100. Other notable performers included Snowflake and Cloudflare, both up by over 3%.

On the downside, chipmakers are seeing declines today, with Microchip Technology and Semiconductor Corp. seeing falls over 1%. Other semiconductor stocks like LAM Research and Texas Instruments have struggled as well.

Kohl’s has forecasted a full-year EPS in the range of 50 cents to 80 cents, slightly higher than the previous 49-cent estimate following a strong Q2 performance.

NCINO reported impressive growth of over 17% after exceeding expectations in second quarter subscription revenue. Meanwhile, American Eagle Outfitters gained more than 5% thanks to a collaboration aimed at leveraging Taylor Swift’s popularity.

Elanco Animal Health climbed more than 4% after being included in the S&P Midcap 400 index. On the other hand, OKTA’s stock increased after it reported stronger-than-expected revenues in Q2, while Dynatrace also benefitted from a favorable assessment by Oppenheimer.

JM Smucker led the S&P 500 losses today with a drop over 4%, after reporting first quarter net sales below expectations. Lastly, PayPal Holdings experienced a decline of over 1% following reports of banks blocking transactions due to suspected fraud.