Last week was another intense week for the stock market, which declined out of the gate on strong reactions to earnings from key companies, including Super Micro Computer (SMCI). Technology (XLK) was one of the weakest sectors, dragged down hard by Broadcom (AVGO) and Coherent Corp. (COHR).  Energy (XLE) saw moves outside investor favorites and leading the gains were the refiners and independents.

There is an interesting phenomenon emerging with hyperscalers moving down while the broad market holds it together.

Medium-size and small-caps stocks enjoyed the strongest moves.  It's amazing how much large-cap value has outperformed large-cap growth. 

The Semiconductor index (SMH) has gained 9% so far this month, marking its best August since 2020.

Broad Market

Market breadth was not bad last week, with more advancers over decliners and new highs over new lows.

The S&P 500 52-week highs minus lows and 10-DMA (blue line) showed limited new-high participation despite the index remaining near its all-time high. 

Earnings season continues with retailers taking the spotlight this week.

Coming into this week, the Fed minutes will be the highlight.

Today’s Session

Major indices for the most part are looking to open marginally lower, with the exception of the Nasdaq, which is still in the green.

Oil and yields are edging higher this morning as reports circulate that some hard liners in Iran seek to widen the conflict.

In other news, a deal was announced this morning.  Nvidia (NVDA) is committing $1.5 billion to SB Energy along with support for an initial 4.25 GW of AI infrastructure serving OpenAI at Ohio's PORTS-Pike campus, and it holds the option to scale that to 8 GW. Construction and operation of the site fall to SB Energy under a two-decade lease to OpenAI, with the first capacity due to arrive in 2028 and the rest phased in after.

On the economic front, the New York Manufacturing Index rose to 20.60 in August from 15.6 in July, marking its third improving month in a row.

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