Mid-Morning Look

Monday, August 25, 2025

U.S. stocks open the new trading week slightly lower following a massive surge on Friday after Fed Chair Jerome Powell hinted that an interest-rate cut could be on the table at the central bank’s meeting next month, lifting risk asset buying sentiment, especially in interest rate sensitive sectors and Smallcaps. Plenty of potential market catalysts again this week including earnings results from the biggest chip player in AI space NVIDIA (NVDA) on Wednesday evening 8/28, results from several software companies (roughly 4% of S&P 500 reports this week overall), and a new round of important economic data including the Fed’s preferred inflation barometer, core PCE on Friday. After surging on Friday, crypto assets are seeing some selling pressure to kick off the week with bitcoin and Ethereum pulling back. US listed China stocks are leading higher following a further bounce in Asian markets overnight as the Shanghai index hits best record in three years. Early strength in large cap tech again (AAPL, GOOGL, NFLX, TSLA, NVDA) boosting the Nasdaq and keeping S&P from falling despite 9 of 11 S&P sectors down on the day in negative market breadth (Staples, Utilities, Healthcare down the most). Treasury yields are edging higher, as gold prices are little changed, and oil prices bounce. The Dow slips early after closing at a fresh all-time high on Friday afternoon.

• In Wind & Alternative Energy: Orsted (DNNGY shares tumbled after the U.S. government ordered to halt construction of the near-complete Revolution Wind project. Bernstein noted the 704MW project is a 50-50 JV between Orsted and GIP (owned now by Blackrock) and is 80% complete in terms of construction with all offshore foundations installed and 45 out of 65 wind turbines installed. Orsted announced an emergency rights issue of DKK 60 billion ($9.4B) earlier in August to help fund a U.S. project sending shares more than 30% lower since. (also watch shares of BWEN, GEV, TPIC among others in the wind names).
• In Crypto: after surging on Friday following Fed Chairman Powell Jackson Hole speech renewed hopes of a rate cut at the September FOMC meeting, boosting risk asset buying, prices of Bitcoin and Ethereum have since pulled back, seeing early weakness as Bitcoin dropped below $111K taking shares of crypto assets and Bitcoin miners (CLSK, MARA, RIOT, HUT) lower. IREN has procured an additional 4.2k NVDA Blackwell B200 GPUs, which doubles IREN’s total GPU fleet to approximately 8.5k NVIDIA GPUs. In addition, IREN has secured financing of $102m for a prior purchase of NVIDIA Blackwell B200 and B300 GPUs.
• Chinese Internet/Retailers: sector got a double boost, with shares of PDD rising on earnings, helping boost other China retailers/stocks BABA, BIDU, JD, NTES, KWEB which were also helped after tracking a rally in mainland China and Hong Kong markets as the Shanghai hit its best level since 2022. However, shares of PDD erased big gains after saying on its conference call they, “do not believe this quarter’s profit levels are sustainable and expect fluctuations in profits in future quarters”.

• FN +4%; upgraded to Overweight from Neutral at JPMorgan and raise tgt to $345 from $318 saying the post-earnings pullback in the shares provides an attractive entry point.
• OKTA +1%; was upgraded to Buy from Hold at Truist and raise tgt to $125 from $100, ahead of fiscal Q2 earnings due on Tuesday as believes Okta is approaching an inflection point as headwinds from seat count pressure and go-to-market changes are seen abating in the second half of FY26.
• PDD +3%; after the Temu platform owner reported Q2 net income and adj earnings per ADR’s that beat the average analyst estimates; the China company pared gains after saying on its c/c that “do not believe this quarter’s profit levels are sustainable and expect fluctuations in profits in future quarters”.
• SCPH +12%; to be acquired by MNKD for $5.35 per share, in deal valued at $303M, accelerating revenue growth and emerging as a patient-centric leader in cardiometabolic and lung diseases.
• VTLE +6%; confirmed a Reuters report from Friday that it would be acquired by CRGY in an all-stock deal valued at $3.1B including debt as Vital shareholders will receive 1.9062 shares of Crescent common stock for each share held, representing a value of $18.95 per share.

• AXGN -15%; after saying the FDA extended by three months its review of the proposed transition of the company’s Avance nerve graft from a tissue product to an approved biologic; FDA now anticipates providing feedback on product labeling in November 2025.
• COIN -4%; following a pullback in crypto related assets as Bitcoin, Ethereum and others slipped.
• DNGGY -16%; shares tumbled after the U.S. government ordered to halt construction of the near-complete Revolution Wind project.
• KDP -8%; as announced it will acquire JDE Peet’s N.V. (JDEPY) for €15.7B ($17.1B) in an all-cash transaction, paying EU31.85 per share.
• RH -8%; along with weakness in ARHS, Wayfair (W) after President Trump Friday posted on social media that the administration will be conducting a “major tariff investigation on furniture” taking place within the next 50 days. The President indicated the category is expected to have a tariff rate yet to be determined.
• VALN -20%; after saying they will no longer be able to sell its chikungunya vaccine in the U.S. after reports linked the vaccine to adverse effects. The FDA suspended the license for Ixchiq following four reports of serious adverse events that were consistent with the chikungunya-like illness.
• VRNT -1%; confirmed a Bloomberg report overnight as they agree to be acquired by private equity firm Thoma Bravo for about $2 billion, including debt, but shares declined as holders to receive $20.50 per share (in-line with the Friday closing price of $20.47).