Closing Recap

Friday, August 22, 2025

US equities looked to bounce back a bit to finish the week with a small gain overnight following several days of retrenchment in big tech. Of course, all eyes were on Powell at Jackson Hole, so overnight moves weren’t especially meaningful. Ahead of the Powell speech, the market saw a 70% probability of a 25bps cut by the Fed in September and a 3.087% implied rate for December of 2026. Early breadth was favoring advancers by 4:1 as small caps outperform with IWM (+0.88%) versus SPY (+0.58%) and QQQ (+0.46%). In sectors, Health Care (+0.95%), Industrials (+0.91%) and Energy (+0.90%) were outperformers, while Materials (+0.66%), Consumer Staples (+0.63%) and Technology (+0.19%) paced the underperformers with all 11 sectors gaining. A comment by Powell that shifting balance of risks may warrant adjusting policy stance was all the market needed to pop (can anyone say all-time highs back in sight?) and push the probability of a September cut to almost 90% while the implied December 2026 rate dipped below 3.05%. Post-Powell, breadth jumped to 9:1 advancers over decliners. The Dow Jones Industrial closed at a fresh record high, for the week the S&P 500 climbed 0.3%, the Dow climbed 1.5% and the Nasdaq fell 0.6%.

Following the morning jump and mostly sideways trend for the bulk of the day, stocks remained strongly in the green heading into the final hour with gains across sectors and market caps. Small caps continued to outperform, while Consumer Discretionary (+2.9%), Energy (+2.1%) and Materials (+2%) led among S&P sector ETFs. Only Consumer Staples were in the red. Growth and value both gained with value the outperformer. The Russell 1000 Value was +1.72% while its Growth counterpart gained 1.58% as tech rebounded from recent losses. With Jackson Hole out of the way, all eyes will be on the upcoming inflation reports (next week PCE) and then CPI, PPI early September, as well as the jobs number before the September Fed meeting for the next significant market catalyst.

• WTI crude futures were flattish overnight with a tilt lower but rallied back to green ahead of Powell’s comments, then extended gains afterward. Hopes and expectations of a September Fed cut spurred interest on the demand side, while concerns over stalled Ukraine peace discussions generated worry about supply. For the day, October WTI futures finished well off the highs but managed to stay green with a gain of $0.14/bbl, or +0.22%, at $63.66. For the week, front month WTI crude rose 2.71%, while natural gas prices fell -7.48% this week back near 9-month lows of $2.698 mln btus.
• The U.S. dollar tumbled this morning/afternoon vs. major rivals, giving back all of the week’s gains after Federal Reserve Chair Jerome Powell pointed to a possible rate cut at the central bank’s September meeting but stopped short of committing to such a move. The euro surged over 1% to $1.1728 and reached $1.1742, the highest since July 28. Against the Japanese yen, the greenback weakened 1.08% to 146.77. Bitcoin prices jumped over $6K off the lows to end near $117,000 in another asset that spiked on Fed hopes.

• In Off-Price retail: ROST topped Q2 profit estimates and reinstated its annual earnings forecast; reported adj. Q2 EPS of $1.56 (vs. $1.40-1.55 guide) inclusive of $0.11 tariff-related headwinds, driven by +2% same-store sales growth (in-line w/ Street and -70bps gross margin contraction Y/Y to 27.6%.
• In Wholesale-Club Retail: BJ Q2 sales miss analyst expectations ($5.38B vs. $5.48B), adjusted EPS beats ($1.14 vs. est. $1.09) as membership fee income rose 9% yr/yr, reaching $123.3M; Company raises FY 2025 EPS guidance to $4.20-$4.35 from 44.10-$4.30 prior and anticipates FY 2025 comparable sales growth of 2.0% to 3.5%; said plans FY 2025 capital expenditures of about $800M
• In Consumer Products/Beauty: ULTA was upgraded to Overweight at Barclay’s with $589 tgt based on return to sustainable positive comps and margin expansion; promotional improvement; ULTA x Target exit optimizing retail distribution points; below-average tariff headwind; and conservative FY25 guide.

• In Leisure sector: For pools, Stifel noted recent analysis validates improving Pool category discretionary sales. For the four weeks ending 6/6/2025, Pool permits +2%, up from -4% in the prior period, with dollar-per-permit +4.9%. Firm highlights SWIM, HAYW in note.

• U.S. utilities rise, tracking Wall Street gains on interest-rate cut hopes (helping high dividend paying sectors on thoughts yields come down). Wall Street’s main indexes surged after U.S. Federal Reserve Chair Jerome Powell pointed to a possible interest-rate cut at the central bank’s next policy meeting during his speech at the Jackson Hole Symposium. Lower interest rates also reduce borrowing costs for utilities, which usually need more capital for expenses such as maintaining the electric grid (VST, ES, EIX, NEE, D, etc. rallied).
• Solar stocks rise on rate cut hopes (FSLR, ENPH, SEDG) as lower interest rates reduce the cost of solar projects, making it a cheaper investment for homeowners, leading to a rise in demand for solar products.
• Homebuilder stocks KBH, BZH, DHI, MTH, TOL, LEN among early market leaders in the S&P 500 following the commentary by Fed Chairman Powell, pointing to a possible rate cut at the upcoming FOMC September meeting but stopped short of committing to cutting interest rates.
• In Truckers/Logistics: JBHT, KNX, CHRW, ODFL, etc. shares active after Secretary of State Marco Rubio said that US will halt issuance of worker visas for commercial truck drivers. Trump in April signed an executive order directing enforcement of a rule requiring commercial drivers in the U.S. to meet English-proficiency standards. In Rails, CSX, NSC shares fall after CSX/BNSF announce new intermodal services, offering seamless coast-to-coast rail solutions/new service between Phoenix and Atlanta to convert OTR freight.
• In Uranium/Power: Early strength in the group (CCJ, DNN, UEC, UUUU, URA, LEU) after Kazatomprom cuts 2026 output by 8M lbs U₃O₈ (~10%), equal to ~6–8% of global supply; Kazatomprom posts lower profit, revenue but backs production guidance. The drop in profit/revenue was mostly due to a fall in sales volumes, it said.

• In Financial Services: INTU shares dropped after reporting solid FQ4 results driven by GBSG/QuickBooks and CK. While overall FY26 guidance was largely in line, GBSG guidance was below due to a larger than expected drag from Mailchimp. TurboTax and CK guidance were better than expected. New TurboTax guidance of 7.8% growth is conservative (vs. 9.4% in FY25). Op. margin guidance of +80 bps Y/Y was better.
• In Brokerage & Investments: LPLA released its monthly activity report for July. Total advisory and brokerage assets at the end of July were $1.94T, an increase of $20.2B, or 1.1%, compared to the end of June. Total organic net new assets for July were $5.4B, translating to a 3.4% annualized growth rate
• In Crypto: a notable bounce after a big pullback in crypto over the last week as Bitcoin and Ethereum recover and lift rest of complex (HOOD, COIN) as well as Bitcoin miners (IREN, MARA, RIOT, WULF, etc.); ETHZ shares tumbled after files S-3ASR registering 74.8M shares for resale by Hudson Bay & other selling stockholders (from $156M convertible notes).

• In Medtech: ISRG remain Sell rated and $440 PT at Deutsche Bank saying extensive checks over the past few months confirm broad and growing interest in cheaper remanufactured instruments amongst similarly sized robotics programs, significant and growing engagement with remanufacturers by larger hospital systems.

• In Media: PSKY was downgraded to Neutral from Buy at Guggenheim and removing its 12-month price target of $13 following a significant run in the stock (shares have appreciated 58% since its August 12, 2025 initiation compared to -0.1% for the S&P500 over the same period). Guggenheim’s core view of the reconstituted company remains unchanged: it expects new leadership to reinvigorate the Paramount content engine, improve technology solutions, and drive incremental efficiencies.

• In Gaming Software: RBLX was upgraded from Peer Perform to Outperform w/ $150 tgt at Wolfe Research and raising its FY’26 Bookings and EBITDA ests. by 7% and 13%, respectively, driven by incremental contributions from Regional Pricing + Advertising opportunities.
• Security Software: FTNT authorizes increase to share repurchase authorization by $1B

• NVDA directs certain component suppliers, including AMKR and Samsung, to pause production work related to H20 chips; said to be a response to Chinese authorities urging local companies to avoid using H20 according to a report in The Information.
• NVDA CEO, on a Taiwan visit to TSM to discuss next-gen Rubin chips, Jensen Huang reiterated denials that any such location-tracking backdoor exists while indicating they are in talks w/ DC about a potential successor to the H20 for China, though clarified that depends on US approval.
• NVDA is working with Washington on approval to sell a new superior AI chip to 🇨🇳 China, the B30A, per CNBC. Huang said it’s “too soon to know” if the U.S. will allow it, but stressed U.S. chips should stay in China’s AI stack, otherwise Huawei will “have China covered.”