Wall Street Morning Report: Nvidia Breaks the 'Earnings Day Curse', Software Stocks Dismiss 'SaaS Apocalypse', Jackson Hole Tonight May Set the Tone for the Second Half of the Year

Every Monday to Friday morning, we focus on macroeconomics, US stocks, AI, precious metals, and crude oil, using data to review the market and trends to seize opportunities, produced by PANews.

Hormuz Stalemate Resurfaces, Venezuela May Withdraw from OPEC, Hawkish Clouds Gather, Dollar and US Treasury Yields Hover at High Levels

Last night, US stocks rose across the board under the strong stimulus of AI earnings, with the Dow Jones Industrial Average up 0.20%, the S&P 500 up 0.72%, and the Nasdaq Composite Index up 1.57%. The gains were almost entirely contributed by technology and software, with only the information technology sector in the S&P 11 sectors closing in the green, while the equal-weight index slightly declined.

Tonight at 22:00, Federal Reserve Chairman Kevin Warsh will deliver one of the most anticipated public speeches since taking office at Jackson Hole. Several Fed officials collectively adopted a hawkish stance on Thursday: Kansas City Fed President Esther George stated that inflation remains stubborn, and current interest rates do not seem to be significantly restraining the economy; Cleveland Fed President Loretta Mester was even more hawkish, stating, "Now is the time to act"; Chicago Fed President Austan Goolsbee warned that inflation has not yet been truly controlled.

However, this does not mean that a rate hike is certain in September, as George clearly stated that more information is still needed, and Goolsbee pointed out that the inflation trend over the past three months is "not too bad." As a result, the market has formed a critical range: the Fed must continue to suppress inflation, but whether to act immediately in September remains uncertain.

The yield on the 10-year US Treasury bond slightly rose to 4.68%, still hovering near a 20-year high. The dollar index closed at 99.16, basically flat, as traders were reluctant to make large bets ahead of significant risk events.

Oil prices rebounded, with WTI and Brent crude oil rising about 2%. The core reason is that the Trump administration has repeatedly made it clear to mediators that it will not return to the memorandum of understanding reached with Iran in June, shifting to economic pressure and continuing maritime blockades. The Iranian Revolutionary Guard and the Supreme National Security Council insist that the old agreement is a prerequisite and have prepared a list of conditions for the US, only temporarily opening specific shipping lanes. Progress in mediation by Pakistan, Oman, and Qatar has been limited, and analysts say both sides are preparing for escalation. Meanwhile, Bloomberg cited insiders saying that Venezuela is evaluating a withdrawal from OPEC and discussing a stake in some oil fields with the US, which could further weaken OPEC's unity and pricing power.

In addition, trade frictions have not cooled down, as Canada announced the addition of US copper wire, charcoal, and other products to its list of 50% counter-tariff measures, effective September 8. The escalation of tariffs will raise costs and make it more difficult for the Fed to quickly shift to easing.

Nvidia Shatters AI Skepticism, Software Stocks Stage 'SaaS Resurrection Night'

Last night, Nvidia broke the narrative of concerns over slowing AI demand with a strong earnings report, driving the Nasdaq up 1.57% and the Philadelphia Semiconductor Index up 2.33%. After Nvidia released results and guidance that far exceeded expectations, its stock surged about 8.74% in a single day, adding approximately $442 billion in market capitalization, marking the second-largest single-day market cap increase in the stock's history (second only to Microsoft's record less than a month ago), and the largest gain since April 2025.

Institutions pointed out that its guidance implies that current expectations still have over $100 billion of upside potential; JPMorgan believes that Nvidia's outlook may still be conservative, as the company is clearly in a "supply-constrained" state, and if supply is not constrained, real demand growth would be higher. Goldman Sachs noted that the three key signals released by management are strong demand, tight supply, and the continued ramp-up of Blackwell and Rubin product lines, while the rising cost of HBM memory remains a focus.

Software stocks also welcomed a major rebound, as the market had been worried that generative AI would destroy traditional SaaS business models, but companies like ServiceNow, Okta, CrowdStrike, and Synopsys proved with their earnings reports that AI is not necessarily a threat but could also be a new growth point. Goldman Sachs directly stated, "Software is not dead." IG Chief Market Analyst Chris Boshang said that the previous "SaaS apocalypse" narrative was an overreaction. The Goldman Sachs SaaS basket has risen close to its highest since April 2025, rebounding about 75% from its lows. The expanded technology software ETF (IGV) recorded its largest single-day gain since the introduction of equivalent tariffs.

The cybersecurity sector was particularly strong, as the more AI becomes widespread, the more companies need to protect data, models, and automated systems. Over 100 organizations, including OpenAI, Anthropic, Google, and Microsoft, have also called for enhanced AI cybersecurity defenses, further reinforcing the logic behind cybersecurity stocks.

Specific Project Actions and Stock Price Fluctuations:

• Nvidia rose 8.74%: breaking the past "earnings day curse," setting the second-largest single-day market cap increase in the stock's history, second only to Microsoft's previous record of about $450 billion. The rise was due to Q2 earnings exceeding expectations across the board, strong Q3 guidance, and a FY2028 revenue growth outlook of about 70% crushing the market's previous expectation of about 45%, directly dispelling concerns over slowing AI demand.

• Related chip stocks also strengthened: Broadcom rose 4.49%, Arm rose 1.65%, Intel rose 4.36%; however, AMD fell 0.89%, Western Digital fell about 1.5%, and SanDisk fell about 0.96%.

• ServiceNow rose 22.58%: with an earnings report that exceeded expectations and a new partnership with Anthropic, shattering the pessimistic narrative of "AI destroying SaaS." The company reported Q2 revenue of approximately $9.78 billion, a year-on-year increase of about 10%, adjusted earnings per share of $2.90, and raised its full-year guidance.

• Related software stocks experienced a rare collective short squeeze: Okta rose 28.63% (stock price reached a four-year high), CrowdStrike rose 20.50% (best single day since its IPO in 2019), Veeva rose 15.20%, and Synopsys rose 13.39%, all exceeding expectations and raising guidance; Palo Alto Networks rose nearly 13%, Adobe rose nearly 6%, Palantir rose nearly 5%, and iShares expanded technology software ETF IGV rose 7.74% (stock price reached a new high for the year).

• SpaceX rose 0.89%: Musk stated that he expects SpaceX's annual revenue to reach $3.5 trillion by around 2033, seven years earlier than Morgan Stanley's previous forecast of 2040. SpaceX's stock price has fluctuated narrowly around $140 over the past three weeks, with implied volatility for options dropping from over 120 before the earnings report to 57, and bullish options trading has increased. Noel Smith of Convex Asset Management believes that volatility has significantly decreased compared to historical levels, but this does not mean options are cheap; he still prefers to sell volatility at a level of 54-55.

• Microsoft rose 1.75%: Saudi Arabia's sovereign wealth fund PIF's HUMAIN announced a long-term AI partnership with Microsoft, aiming to promote the ALLAM model into Microsoft's AI ecosystem and integrate AI experts with Microsoft deployment engineers. Among related large tech stocks, Apple rose 0.36%, Tesla rose 2.60%, Amazon fell 1.54%, Meta fell 0.87% (internally estimated that annual spending on Anthropic's AI model could reach up to $10 billion), and Google A fell about 0.39%.

• Marvell Technology fell 1.49%, briefly dropping about 8% after hours: Q2 revenue grew 37% year-on-year to $2.74 billion, and the Q3 guidance exceeded expectations, but due to the significant rise in stock price this year and extremely high market expectations, some profit-taking occurred.

• Workday rose 1.48%, briefly dropping over 7% after hours before narrowing: the company’s Q2 revenue slightly exceeded expectations, but the subscription backlog guidance was below market expectations, dragging down after-hours performance. The company announced a buyback of up to $4 billion and expanded its cooperation with AWS and Google Cloud, introducing AI agents into human resources and financial processes. Barclays analyst Raimo Lenschow stated that SaaS has recently recovered, but Workday's performance and guidance, which are mostly in line with expectations, are unlikely to become new catalysts.

Upcoming Focus:

August 28 (Friday)

• 22:00 Warsh's Jackson Hole Speech: will decide how the market re-prices interest rates. If he is clearly hawkish, US Treasury yields and the dollar may rise, putting pressure on tech stocks and gold; if not hawkish enough, risk assets may continue to rebound.

• 22:00 US August Michigan Consumer Sentiment Index Final Value & Non-Farm Employment Benchmark Revision Initial Value: inflation expectation sub-data will directly affect the market's pricing of long-term rates. The magnitude of the employment data revision will determine the strength of the "economic resilience" narrative.

• Meituan, BYD, and China Petroleum earnings: Meituan will focus on takeaway competition and profit margins; BYD will focus on overseas expansion and new energy vehicle gross margins; China Petroleum will be affected by oil prices and natural gas demand.

August 29 (Saturday): Changxin Storage's parent company Changxin Technology will release its first semi-annual report after going public.

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