Closing Look - 8/4/26

Stocks stormed into August with another record-setting session Tuesday...

Summary

🟢 Stocks stormed into August with another record-setting session Tuesday, as easing US-Iran tensions and a wave of strong earnings sent the S&P 500 and Dow to fresh all-time highs and lifted the Nasdaq Composite to its best close in weeks.

Palantir’s (PLTR) blowout quarter and a broad chip-stock rally set the tone early, while Caterpillar (CAT) and Wayfair (W) both surged on beat-and-raise results.

The mood turned more mixed after the close, though: SpaceX (SPCX) delivered its first quarterly report as a public company and Advanced Micro Devices (AMD) topped Wall Street’s estimates, but both stocks were sold off in after-hours trading as investors focused on the scale of AI-related capital spending rather than the headline beats.

Oil rebounded modestly off Monday’s sharp selloff, Treasury yields eased, and the dollar held mostly steady.

Major Indices & Breadth

• 🟢 Nasdaq Composite closed at 26,584.99, +2.59%, powered by Palantir’s post-earnings breakout and a broad AI/tech comeback.

• 🟢 S&P 500 closed at 7,736.52, +1.79%, a fresh record close and its first new high in two months, topping the prior June peak.

• 🟢 Dow added 907.47 points (+1.71%) to close at 54,085.88, a record close and the first time above 54,000.

• 🟢 Russell 2000 also notched a record close, extending Monday’s rally with small-caps rising roughly +1.6% on the day.

• 🟢 NYSE Composite rose +0.61%; breadth was strongly positive, with advancers outpacing decliners by better than 2-to-1 and roughly 68% of issues higher at midday. Technology (+4.2%) and industrials (+3.4%) led sector gains, while energy and utilities were the only laggards.

Leaders

• PLTR +29.45%

• W +28%

• ZBRA +22%

• IT +18%

• CAT +5.97%

Laggards

• ROK -6.4%

• CMG -10%

• NRG -10%

• BRKR -12%

• APTV -15.5%

Earnings

• 🔴 SPCX posted its first quarterly report since its June IPO: Q2 revenue of $7.81B (+92% YoY, beat $6.81B est), adjusted EBITDA of $3.5B (beat $2.0B est), and a narrower-than-expected loss of $0.09/share (vs. a -$0.26 est loss). AI segment revenue jumped +247% YoY to $2.6B, but AI-related capex ballooned to $15.8B from $7.7B in Q1, pushing total quarterly capex to $18.4B. CFO Bret Johnsen said the company is on pace for a $100B annualized revenue run rate by year-end, and SPCX announced a new partnership with Nvidia (NVDA) on orbital “space compute” hardware. Shares rose +9.43% in the regular session to $125.33, then reversed to close down roughly -8.56% after hours to about $114.60 as investors weighed the surge in AI capex against growth targets.

• 🔴 AMD reported record Q2 revenue of $11.54B (+50% YoY, beat $11.28B est) and adjusted EPS of $1.66 (beat $1.62 est), with Data Center revenue more than doubling to $6.72B (+107% YoY, now 58% of total revenue). Guidance called for Q3 revenue of roughly $13B (±$300M), implying +41% YoY, with a non-GAAP gross margin near 56%. Despite the beat-and-raise, AMD shares—up as much as +8% in the regular session heading into the print—reversed sharply after hours, falling roughly -5.5% to around $490 as investors focused on the gap between results and elevated “whisper number” expectations following recent AI-partnership headlines.

• 🟢 PLTR delivered what CEO Alex Karp called an “otherworldly” quarter: Q2 adjusted EPS of $0.41 (beat $0.35 est) and revenue of $1.94B (+93% YoY, beat $1.80B est). US commercial revenue surged +149% YoY to $764M, and the company raised full-year 2026 revenue guidance to $8.15–8.16B from a prior $7.65–7.66B range (vs. $7.69B est). Shares surged +29.45%.

• 🟢 CAT posted record Q2 revenue of $20.5B, beating the $19.3B estimate, driven by a +29% YoY jump in power-generation equipment demand. Shares rose +5.97%, among the largest single-stock contributors to the Dow’s gain.

• 🟢 W beat on both lines with Q2 adjusted EPS of $0.95 (vs. $0.87 est) and net revenue of $3.52B (vs. $3.45B est) as US revenue growth accelerated. Shares jumped +28%.

• 🟢 Zebra Technologies (ZBRA) climbed +22% on a Q2 beat and improved guidance, while Gartner (IT) rose +18% after raising its 2026 adjusted EPS outlook to $14.

• 🔴 Aptiv (APTV) fell -15.5% after cutting its 2026 revenue outlook to roughly $12.7B and reporting a large sequential revenue decline following recent business spin-offs, amid broader automotive-sector headwinds.

• 🔴 NRG Energy (NRG) dropped -10% after posting Q2 EPS of $1.49, below forecast.

• 🔴 Rockwell Automation (ROK) fell -6.4% despite beating estimates on both lines, as investors judged the outlook too conservative relative to elevated expectations heading into the print.

• 🔴 Bruker (BRKR) sank nearly -12% on a Q2 revenue miss and softer-than-expected full-year guidance.

• 🟢 McDonald’s (MCD) edged +1% higher on an earnings beat.

AI

• 🟢 NVDA climbed roughly +2.5% to around $212 as chip stocks rallied broadly ahead of AMD‘s print, with the VanEck Semiconductor ETF (SMH) up about +5% on the session.

• 🟢 Memory names extended their recent run: SanDisk (SNDK) rose +10% and Micron (MU) gained +8% ahead of SNDK‘s own Wednesday earnings report (see Tomorrow’s Calendar), while Astera Labs (ALAB) advanced +11%.

• 🟡 AI infrastructure shares broadly firmed amid speculation over a potential China chip-component ban, adding a fresh headline risk to the group even as the sector rallied.

• 🔴 The chip trade’s mood soured after the close: both AMD and SPCX (see Earnings) topped Wall Street’s headline estimates but were sold off in after-hours trading as investors focused on the scale of AI-related capital spending rather than the beats—a read-through that could weigh on sentiment heading into NVDA‘s own August 26 report.

Corporate

• 🔴 Amazon (AMZN) slipped -1.7% after founder and executive chairman Jeff Bezos filed to sell roughly 15 million shares worth about $4.1B.

• 🔴 Chipotle (CMG) fell (see Laggards) after the company temporarily pulled jalapeños from some Minnesota restaurants amid a public-health investigation into a salmonella outbreak linked to its supply chain; health officials said there is no ongoing broader safety concern.

Market Structure

• 🟡 No notable index-inclusion, reconstitution, or market-structure rule changes to report today.

Macro/Policy

• 🟡 The June JOLTS report showed US job openings fell to 7.36M, down from a revised 7.54M in May and below the 7.44M consensus, though layoffs held flat at a 1.1% rate—keeping the labor-market read fairly resilient heading into Friday’s July jobs report.

• 🟡 Markets are still digesting Fed Chair Kevin Warsh’s recent commentary as officials debate whether persistent inflation warrants a rate hike later this year (see Prediction Markets); Wednesday brings the July ADP employment report and ISM Services Index (see Tomorrow’s Calendar).

Treasury Bonds

• 🟢 The 10-Year yield eased about 7 basis points to roughly 4.61% as Treasuries firmed alongside the broader risk-on tone and falling oil prices.

• 🟢 The 2-Year yield held near 4.21%, while the 30-Year sat around 5.20%, leaving the 2s10s spread little changed.

Geopolitics

• 🟡 US-Iran talks remained fluid: Treasury Secretary Scott Bessent said Tuesday morning that Washington and Tehran could reach an agreement “today or tomorrow” to reopen the Strait of Hormuz, while President Trump separately called his latest proposal Iran’s “final” chance and said he expects the strait to reopen soon. Iran denied that direct talks with the US were underway, though it said discussions with Oman on increasing strait traffic were progressing.

• 🟡 OPEC+ approved a modest production increase, completing the restoration of 2023-era supply cuts, while Turkey and Iraq extended a key pipeline agreement and Kazakhstan resumed Caspian Pipeline Consortium flows—all easing near-term supply concerns (see Commodities).

Foreign Markets

• 🟢 DAX added +0.36% to 26,095.68.

• 🟢 Shanghai Composite gained +0.33% to 3,822.28.

• 🟢 Nikkei 225 rose +0.32% to 63,957.53.

• 🟢 FTSE 100 rose +0.24% to 10,883.80.

• 🔴 CAC 40 slipped -0.05% to 8,609.51.

• 🔴 Hang Seng fell -0.60% to 25,852.92.

Currencies

• 🟡 DXY was little changed, up +0.01% to 99.97, holding near seven-week lows.

• 🟡 EUR/USD held steady around 1.1505.

• 🟢 USD/JPY rose about +0.4% to roughly 157.7 as the yen gave back some of last week’s intervention-driven gains.

• 🟡 GBP/USD held in a range below 1.3450.

Commodities

• 🟢 Silver rose +1.83% to $58.74/oz.

• 🟢 Copper gained +1.74% to $6.63/lb.

• 🟢 Gold rose +1.01% to roughly $4,075.

• 🟢 Brent crude rebounded about +1% to roughly $84.89, recovering part of Monday’s selloff.

• 🟢 WTI crude rebounded about +1% to roughly $81.80, recovering part of Monday’s -5% slide to $80.34 as Strait of Hormuz uncertainty persisted (see Geopolitics).

Crypto

• 🟢 Bitcoin held near $63,500, up modestly on the day, as spot-ETF inflows and cooling geopolitical risk kept crypto in positive territory.

• 🟡 Ethereum traded little changed near the $1,870–$1,900 range amid ongoing Clarity Act legislative uncertainty in Congress.

Prediction Markets

• 🟡 Polymarket bettors price roughly a 78% chance of at least one Fed rate hike sometime in 2026, with the September meeting seen as the highest-probability inflection point at around 70% odds—a meaningfully more hawkish read than most economist consensus forecasts.

• 🟡 On Iran, Polymarket’s most actively traded contract assigns an 80% “No” probability to a US invasion of Iran before 2027, while Strait of Hormuz normalization contracts remain thinly priced for a near-term full reopening.

Volatility

• 🟢 VIX fell to roughly 15.7, a multi-month low, reflecting easing near-term risk perception after Monday’s Iran de-escalation and Tuesday’s record-setting equity rally.

• 🟡 With AMD and SPCX (see Earnings) both drawing mixed after-hours reactions and Wednesday’s ADP/ISM Services data on deck, front-end vol could tick higher into Wednesday’s open depending on how the AI trade digests tonight’s results.

Tomorrow’s Calendar

• Earnings before the open: Eli Lilly (LLY), Novo Nordisk (NVO), Honda (HMC), Kraft Heinz (KHC), CVS Health (CVS), Expedia (EXPE), Nutrien (NTR).

• Earnings after the close: SNDK, Walt Disney (DIS), Shopify (SHOP), Uber (UBER), AppLovin (APP).

• Economic data: July ADP employment report and July ISM Services Index.

• No major Fed speakers scheduled Wednesday; St. Louis Fed’s Musalem speaks Thursday and Richmond Fed’s Barkin speaks Friday, ahead of Friday’s July jobs report.

3 Scenarios

• 🟢 Bullish: The AI trade shrugs off tonight’s after-hours reactions in AMD and SPCX as noise around otherwise strong fundamentals; a Strait of Hormuz breakthrough materializes, oil extends its rebound lower, and Wednesday’s ADP/ISM data print in line—S&P 500 pushes toward 7,800 and the Nasdaq’s record high comes back into view.

• 🟡 Neutral: AMD and SPCX weakness bleeds modestly into chip sentiment at Wednesday’s open, but Eli Lilly, Disney, and Uber earnings provide fresh crosscurrents; Hormuz talks continue without a firm resolution—indices consolidate near current record levels while volatility stays historically low.

• 🔴 Bearish: The after-hours capex concerns around AMD and SPCX prove to be the start of a broader re-rating of AI infrastructure spending; Iran talks stall and oil reverses higher; a soft ADP print raises stagflation concerns ahead of Friday’s jobs report—S&P 500 pulls back from record highs and small-caps give back Tuesday’s gains.

Final Take

Tuesday was a study in contrasts: a broad, record-setting rally during the day gave way to a more skeptical mood once the bell rang.

PLTR, CAT, and W all delivered the kind of beat-and-raise quarters that justify record highs, and the S&P 500, Dow, and Russell 2000 all closed at fresh peaks with breadth firmly in favor of buyers.

But the after-hours reactions in AMD and SPCX are the more important signal heading into Wednesday.

Both companies beat headline estimates by a wide margin, yet both stocks fell as investors zeroed in on the scale of AI-related capital spending rather than the growth numbers themselves.

That’s a subtle but real shift from the “beat is enough” dynamic that carried the AI trade through much of the summer.

Bottom line: with NVDA‘s own report still three weeks away, Wednesday’s open is the first real test of whether tonight’s capex-driven selling was an isolated reaction to two idiosyncratic reports, or the leading edge of a broader repricing of what the market is willing to pay for AI growth.

Source: CNBC, Reuters, Bloomberg, CNN, Yahoo Finance, TheStreet, Benzinga, Trading Economics, BLS.

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