September S&P 500 E-Mini futures (ESU26) are down -0.19%, and September Nasdaq 100 E-Mini futures (NQU26) are down -0.59% this morning, pointing to a lower open on Wall Street as chipmakers came under pressure at the start of a pivotal week.
Chip and AI infrastructure stocks were among the biggest losers in pre-market trading, following a slump in major tech names across Asia. Samsung Electronics sank over -8% in Seoul after the chipmaker’s record shareholder return plan disappointed investors. Also, Alibaba Group tumbled more than -8% in Hong Kong after the tech heavyweight raised HK$80 billion ($10.2 billion) to fund AI investments. In addition, SoftBank Group slid over -5% in Tokyo after announcing plans for a record 1 trillion yen ($6.3 billion) retail bond sale to finance its AI investments.
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Meanwhile, the price of WTI crude fell over -2% on Monday, snapping a six-day winning streak, as investors awaited details of Treasury Secretary Scott Bessent’s plan to economically isolate Iran. The drop in oil prices buoyed the debt market, with the 10-year T-note yield falling two basis points to 4.71%.
This week, market participants will focus on Nvidia’s earnings report, Federal Reserve Chairman Kevin Warsh’s speech at Jackson Hole, and a slew of U.S. economic data.
In Friday’s trading session, Wall Street’s major equity averages ended in the green. Cryptocurrency-exposed stocks jumped as Bitcoin extended its climb, with Coinbase Global (COIN) rising over +8% and Strategy (MSTR) advancing more than +6% to lead gainers in the Nasdaq 100. Also, Tesla (TSLA) climbed over +5% after the EV maker announced a European launch event for its all-electric semi-truck. In addition, Ross Stores (ROST) gained more than +4% after the off-price retailer reported better-than-expected Q2 results and raised its full-year EPS guidance. On the bearish side, some chip and AI infrastructure stocks slid, with Marvell Technology (MRVL) falling over -5% to lead losers in the S&P 500 and Nasdaq 100 and Arm Holdings (ARM) dropping nearly -3%.
Economic data released on Friday showed that U.S. business activity continued to expand in August as a sharp pickup in service-sector activity helped offset a notable slowdown in the manufacturing sector. The S&P Global flash U.S. services PMI climbed to 56.8 in August, matching its highest level since March 2022 and topping expectations of 53.9. At the same time, the S&P Global flash U.S. manufacturing PMI fell to 53.2 in August, weaker than expectations of 54.0.
Minneapolis Fed President Neel Kashkari, one of three officials who dissented in favor of a rate hike last month, highlighted concerns over potentially persistent inflation on CBS’s Face the Nation on Sunday, but stopped short of saying he would again support a rate increase in September. “We need to see more data, but I don’t want to prejudge the next meeting,” Kashkari said.
U.S. rate futures have priced in a 61.6% probability of no rate change and a 38.4% chance of a 25-basis-point rate hike at the conclusion of the Fed’s September meeting.
In tariff news, the U.S. imposed 50% tariffs early Saturday on Canadian products representing about $20 billion in annual trade, including plywood, liquor, electrical equipment, and hockey gear, after negotiations between the two countries collapsed at the last minute. In response, Canadian Prime Minister Mark Carney said on Saturday that the country will impose retaliatory tariffs on $20 billion worth of U.S. products on September 8th. “You’re at war when you get attacked. We got attacked,” Carney said.
This week, investors will closely watch the earnings report from AI bellwether Nvidia (NVDA). The chipmaker, which remains at the center of the AI boom, is set to report its Q2 results after the closing bell on Wednesday, in what will be a key test for the AI trade and the broader market. “Nvidia’s quarterly results are significant to the broader market because the company sits at the center of the AI trade, which itself is a major driver of the market,” according to Jacob Bourne at Emarketer. Investors will be watching for updates on AI infrastructure demand, the timing of the Rubin ramp, China exposure, and the economics of the company’s growing financing partnerships. Nvidia’s stock has struggled to gain momentum since its last earnings report, setting up an intriguing backdrop ahead of its Q2 results. However, it is also worth noting that the stock slid after its last three quarterly reports, despite delivering upbeat results and guidance. NVDA stock is expected to move 5.25% in either direction by Friday’s close, based on 85% of the value of the at-the-money straddle, according to Barchart.
Smaller chipmaker Marvell Technology (MRVL), software companies Salesforce (CRM) and Intuit (INTU), and discount retailers Dollar General (DG) and Dollar Tree (DLTR) are also scheduled to report quarterly results this week.
Market watchers will also keep a close eye on the Kansas City Fed’s annual Economic Policy Symposium, which kicks off on Thursday in Jackson Hole, Wyoming. The event brings together central bankers, finance ministers, academics, and financial market participants from around the world to discuss key challenges facing the global economy. This year’s symposium, held under the official theme “Financial Innovation: Implications for Payments and Policy,” comes amid the most turbulent bond market since at least 2022, putting the spotlight on Kevin Warsh’s first Jackson Hole appearance as Fed chairman. Mr. Warsh is set to deliver keynote remarks on Friday, and investors will be looking for greater clarity on how he believes the U.S. central bank should respond to stubborn inflation.
“Warsh must address how the Fed will bring down inflation,” said Jim Bullard, former St. Louis Fed president and current dean of Purdue University’s Mitch Daniels School of Business. “The Fed’s credibility is at risk—the markets are starting to think that the committee doesn’t really care about getting to 2%,” according to Bullard. And while Warsh has said the Fed will deliver price stability, Bullard noted that he has not indicated whether he is willing to raise interest rates to achieve that goal.
In addition, market participants will monitor a raft of U.S. economic data releases this week. The July reading of the core personal consumption expenditures price index, the Fed’s preferred inflation gauge, will be the main highlight. Economists expect the core PCE price index to rise +0.2% m/m in July, keeping the annual rate steady at +3.3%. The Bureau of Labor Statistics’ preliminary benchmark revision to payrolls for the year ended in March will also draw attention. Other noteworthy data releases include U.S. gross domestic product (second estimate), the Conference Board’s Consumer Confidence Index, the S&P/CS HPI Composite - 20 n.s.a., New Home Sales, the Richmond Fed Manufacturing Index, Durable Goods Orders, Core Durable Goods Orders, Personal Spending, Personal Income, Initial Jobless Claims, the Chicago PMI, and the University of Michigan’s Consumer Sentiment Index.
The U.S. economic data slate is largely empty on Monday.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 4.71%, down -0.51%.
The Euro Stoxx 50 Index is down -0.05% this morning as investors adopted a cautious stance at the start of a busy week. Energy stocks led the declines on Monday, pressured by a drop in oil prices. Technology stocks also slipped, tracking weakness among their Asian peers. Limiting losses, mining stocks advanced, buoyed by higher gold prices. In addition, travel and leisure stocks climbed. Meanwhile, Eurozone government bond yields declined on Monday as lower oil prices eased inflation concerns, with investors awaiting details of threatened U.S. sanctions against Iran. Beyond Nvidia earnings and the Federal Reserve’s annual gathering, investors will have plenty to digest in the region this week. Preliminary August inflation figures from France and Spain will be the main highlights, with both expected to show a further pickup in price pressures. Eurozone inflation data will only be released the following week, though European Central Bank Chief Economist Philip Lane recently warned that inflation in the region will hover around 3% for the rest of the year. “It’s looking increasingly likely that the European Central Bank will deliver on our expectation for a rate hike to 2.5% in September and stay hawkish beyond then,” said Ricardo Amaro at Oxford Economics. Market participants will also closely watch the account of the ECB’s July policy meeting. In addition, Germany’s Ifo business indicator for August and details on the drivers of second-quarter GDP will draw attention.
The European economic data slate is empty on Monday.
Asian stock markets today closed in the red. China’s Shanghai Composite Index (SHCOMP) closed down -0.59%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -0.74%.
China’s Shanghai Composite Index closed lower and hit a 3-week low today, dragged down by weakness in the tech sector. Technology stocks led the declines on Monday, weighed down by supply concerns stemming from the fundraising plans of Alibaba Group and Yangtze Memory Technologies Co. Alibaba Group tumbled over -8% in Hong Kong, its steepest drop since early 2025, after the tech heavyweight raised HK$80 billion ($10.2 billion) to fund AI investments in Hong Kong’s largest secondary share offering. The company sold 710 million shares at HK$112.7 apiece, representing a discount to Friday’s closing price in Hong Kong. “This placement is pretty surprising to the market, in terms of both its size and the discount,” according to Jason Chan at Bank of East Asia. Separately, the Shanghai bourse accepted the application for chipmaker Yangtze Memory’s potentially sizable initial public offering. In addition, the tech selloff came as regional peers weakened amid renewed concerns about the durability of the AI trade ahead of Nvidia’s earnings later this week. Meanwhile, Goldman Sachs chief China economist Hui Shan said in a recent report that China’s economic growth slipped further below Beijing’s annual target of 4.5% to 5% at the start of the third quarter, raising expectations for monetary easing. “Our conversations with traders and investors suggest that market expectations of monetary policy easing increased somewhat,” Hui said. In corporate news, China Petroleum & Chemical Corp. gained over +4% after the energy major posted stronger first-half net profit, supported by higher oil prices. Investor attention this week is on China’s July industrial profits data, which will offer another gauge of the health of the corporate sector in the world’s second-largest economy. Investors are also looking ahead to the National People’s Congress Standing Committee meeting in Beijing on August 25-28.
Japan’s Nikkei 225 Stock Index closed lower today as the AI trade came under pressure at the start of a busy week. Chip and other AI-related stocks, which carry significant weightings in the Nikkei, declined on Monday. Tech heavyweight SoftBank Group sank over -5% after announcing plans for a record 1 trillion yen ($6.3 billion) retail bond sale to finance its AI investments. Sentiment toward the AI trade also weakened as South Korea’s Kospi dropped over -3%, weighed down by a more than -8% slump in Samsung Electronics after its record shareholder return plan disappointed investors. In addition, Japanese government bond yields mostly rose on Monday amid inflation and fiscal concerns, further souring investors’ risk appetite. Wataru Akiyama at Nomura Securities said “it does not appear that the Japanese stock market is currently in a position to sustain an upward trend” amid rising bond yields. In other corporate news, Miura Co. rose over +4% after a regulatory filing revealed that Silchester took a 5.06% stake in the company. Investor focus this week is on Japan’s August Tokyo Core CPI, which will be closely monitored to assess whether inflation remains firm enough to pave the way for further monetary policy normalization by the Bank of Japan. Japan’s Corporate Services Price Index and employment data for July will also attract attention. In addition, market participants will closely watch a speech from BOJ Deputy Governor Ryozo Himino. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed down -0.88% to 28.13.
Pre-Market U.S. Stock Movers
Chip and AI infrastructure stocks slid in pre-market trading, with Sandisk (SNDK) falling over -4% and Marvell Technology (MRVL) dropping more than -3%.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Monday - August 24th
Napco Security Technologies (NSSC), Gorilla Technology Group (GRRR).
On the date of publication, Oleksandr Pylypenko did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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