Stock Market Soars: Nasdaq Tops 18,000, AI and AMD Lead the Charge

S&P 500 and Nasdaq Extend Rally as Rotation Accelerates

The S&P 500 and Nasdaq Composite posted fresh all-time highs, with the Nasdaq crossing 18,000 and the S&P nearing 5,550. Breadth broadened across sectors, as energy, financials, and industrials joined the rally. While megacap AI names remain in charge, momentum is quietly rotating into small caps and infrastructure-linked plays. The Russell 2000 climbed to six-month highs, while the Dow Jones added over 290 points. Volatility stayed compressed, with the VIX below 15.

CPI Triggers Repricing of Rate Cuts as Powell Pressure Builds

Core CPI at 3.1% y/y and headline at 2.7% reinforced the disinflation trend but didn’t spark a hawkish shift. Fed Fund Futures now price in a 70%+ probability of a September cut, with some chatter of a possible 50 bps move. Long-end yields dropped, with the 10-year Treasury yield nearing 4.25%. The next major policy event—Jackson Hole on Aug. 21–23—will be a stress test for this pricing, especially after Bessent’s unexpected call for 150 bps in cuts this cycle.

Bessent Shocks With 150 bps Cut Suggestion

Treasury Secretary Scott Bessent pushed the dovish envelope, openly floating a 150 bps total easing path for the Fed, including a 50 bps start in September. While markets haven’t fully priced that in, the shift in tone added firepower to rate-sensitive names and flattened the yield curve. Jackson Hole now carries elevated risk: if Powell fails to echo that dovish tilt, equities could face whiplash.

AI Still Dominates, But Under-the-Surface Rotation Builds

AI megacaps—NVDA, AMD, MSFT, GOOGL, AMZN—continue to lead, but institutional flows are expanding into industrials and cooling suppliers tied to AI infrastructure. Some hedge funds are trimming top-5 tech exposure in favor of second-tier plays benefitting from the AI build-out. Despite this, megacap dominance remains intact, with the top 20 stocks accounting for over 50% of S&P returns YTD.

Semiconductors in the Spotlight: AMD Surges, CRWV Misses

AMD spiked over 5% on growing optimism around MI300 demand and hyperscaler adoption. Micron gained as DRAM tightness supports upward guidance. Intel met with the White House on chip policy, triggering speculative flows. In contrast, CoreWeave missed EPS estimates despite $1.21B revenue and a massive $30.1B backlog. Rising interest expenses—now $350–390M—overshadowed operations and pushed shares down 10%+.

Eli Lilly Insider Buys Signal Confidence Amid Drug Selloff

Following a selloff in weight-loss drug names, LLY insiders stepped in. CEO Dave Ricks bought ~$1M in stock, while CSO Dan Skovronsky added ~$643K. The size and timing of these buys imply strong conviction, with many viewing it as a near-term bottom signal in large-cap healthcare.

Mixed Restaurant Earnings: CAVA Tanks, EAT Rips, MCD Holds

CAVA disappointed with just 2.1% comp growth and revenue of $280.6M, below expectations. Guidance was cut to 4–6% same-store sales vs. 6–8% prior. Shares plunged over 20%. Meanwhile, Brinker (EAT) beat across the board—posting $2.49 EPS on $1.46B revenue, with Chili’s traffic up 16%. McDonald’s held firm, with brand strength and premium formats offering defensive stability.

Refinancing Surges as Treasury Yields Drop

Mortgage application data revealed a 23% jump in refis, the largest in months. Purchase apps held steady. Falling Treasury yields are reopening the door for activity, but tight inventory and high prices still constrain broader housing momentum.

Crypto Equity Boom: Bullish IPO, Circle Follow-On, ETH Strategy

Bullish (BLSH) priced its IPO at $37 (above range), raising $1.1B at a $5.4B valuation. Circle (CRCL) launched a 10M-share follow-on after a 425% post-IPO run, with Q2 revenue at $658M and USDC supply growing to $65.2B. Meanwhile, Bitmine (BMNR) is looking to raise $20B to accumulate Ethereum as part of a treasury diversification strategy. BTC-USD stayed near $122,000, ETH-USD above $4,600.

Upgrades, M&A, and REIT Momentum

Capri (CPRI) received a new $30 price target (vs. $19.60), citing turnaround potential. AvalonBay (AVB) was upgraded to Overweight with a $225 target as multifamily rental income accelerates. Hanesbrands (HBI) was acquired by Gildan (GIL) at $6/share, implying ~$4.4B enterprise value. Shares initially fell but stabilized as terms clarified.

Asian Markets Fuel Global Risk Appetite

Japan’s Nikkei 225 hit new highs led by auto and semiconductor strength. China’s CSI 300 rebounded over 16% from April lows, helped by margin growth and retail leverage. Tencent (0700.HK) rose after 15% revenue growth (¥184.5B), reinforcing AI’s tailwind in gaming, cloud, and ad tech.

Volatility Suppressed Ahead of Jackson Hole

With VIX below 15, market complacency is building. The soft CPI reinforced September cut bets, but any hawkish Powell pivot in Wyoming could break the calm. Rate-sensitive names like gold miners, small caps, and the dollar index will be the first to react.

Actionable Calls Based on Supplied Data