FinksDaily
🔄 Sector reset
Good morning. Clown school is having an oddly serious career moment. Actors burned out by rejection and the pressure to be perfect are turning to clowning (opens in a new tab), where getting things wrong is part of the training. Corporate attorneys, therapists, and union leaders are joining them, using the workshops to get better at reading a room, thinking on their feet, and staying composed under pressure. Who would've guessed the class clown had the best career prospects all along?
Speaking of reading the room, it’s time for our monthly market survey. So let us know: Are you feeling bullish or bearish heading into September? (Click to vote.)
Sector Spotlight
Software’s Comeback Gains Ground as Earnings Challenge the AI Selloff
The software sector was written off too soon. After AI disruption fears crushed valuations, enterprise software stocks are starting to recover, with strong earnings doing much of the work. Now investors have to decide whether the rebound has staying power or is simply another momentum-driven bounce.
Bouncing back: The S&P software index lost more than 33% (opens in a new tab) between its Oct. 28 record high and Apr. 10, as concerns over AI disruption pushed valuations sharply lower. The selloff intensified after Anthropic released a new product in January, raising fears that some traditional software tools could eventually become obsolete. The index has since rebounded 33%, but it remains down more than 3% for the year.
- Microsoft surged 29% over eight sessions following its Jul. 29 earnings release, the single biggest catalyst in the index's summer recovery.
- The equal-weight software ETF has risen ~24% since Jun. 22 while the semiconductor ETF has fallen ~24%, the widest gap between the two on record.
Earnings Bring Relief
Salesforce and CrowdStrike both delivered strong results Wednesday evening. Salesforce raised (opens in a new tab) its fiscal 2027 revenue outlook and announced a broader AI partnership with Anthropic, while CrowdStrike issued (opens in a new tab) an annual revenue forecast above expectations as demand for AI-powered security remained strong. Both stocks rose after hours.
- CrowdStrike ended Q2 with $5.84B in annual recurring revenue, beating consensus as shares climbed more than 62% this year.
- Salesforce grew Q2 revenue 11% to $11.35B, topping estimates even as the stock remains down 22% this year.
Not every name is celebrating: The same earnings week exposed (opens in a new tab) a widening split across software. UBS downgraded SAP to Neutral over its slow agentic AI rollout, while Intuit fell after guiding to weaker growth this year. Cybersecurity names are still holding up better than traditional SaaS, and the rapid growth of leveraged single-stock ETFs is making those moves even more pronounced.
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Large-Cap Recap
Nvidia Faces Structural Hurdles Amid Record Growth
Nvidia posted record quarterly revenue of $96.2B, yet investors remain cautious as hyperscaler dependence emerges as a key structural risk. Major customers like Amazon and Alphabet are seeing negative cash flow, potentially capping future GPU demand. To sustain momentum, Nvidia is partnering with firms like BlackRock to finance AI infrastructure as an asset class. With gross margins under pressure and supply commitments reaching $279B, efficiency gains in AI software may further challenge hardware sales. [Read (opens in a new tab)]
Sticky Inflation And Economic Growth Pressure The Fed
The latest personal consumption expenditures report showed inflation remains stubbornly high, with the annual index rising 3.7% in July. Economists had expected inflation to cool, but prices made no progress during the month. At the same time, strong consumer spending and record corporate profits suggest the US economy is gaining momentum rather than slowing. That combination of persistent inflation and resilient growth raises the risk of another interest rate hike as policymakers struggle to return inflation to their 2% target. [Read (opens in a new tab)]
Revolution Medicines Lands a Breakthrough Approval
Revolution Medicines secured early FDA approval for Rasonque, a landmark drug targeting RAS-driven pancreatic cancer. Clinical results showed patients doubled their median survival time compared to standard chemotherapy. While this represents a significant medical advancement, shares barely rose as investors had largely priced in the news following a 166% rally this year. Future growth will depend on expanding Rasonque into first-line treatment and broader cancer indications while fending off competition from Eli Lilly and other pharmaceutical giants. [Read (opens in a new tab)]
Market Pulse
Abercrombie & Fitch Co.
ANFThe apparel retailer’s shares rose as quarterly sales and earnings beat expectations, prompting it to raise its full-year outlook.
Zoom Communications, Inc.
ZMThe video software company’s shares fell as weaker third-quarter profit guidance overshadowed a quarterly earnings and revenue beat.
The J. M. Smucker Company
SJMThe packaged foods maker’s shares rose as earnings and revenue beat estimates, helped by higher coffee prices and an upgraded full-year outlook.
Markets & Economy
US pauses immigrant visa appointments worldwide: The State Department is rescheduling interviews globally while consular officers undergo new screening training. The pause comes as the Trump administration continues tightening legal immigration rules and visa scrutiny. [Read (opens in a new tab)]
Durable goods orders beat expectations: US orders rose 1.1%, well above forecasts and up from the prior month’s 0.3% gain. The stronger reading points to resilient manufacturing demand and continued business investment. [Read (opens in a new tab)]
Apple sets Sept. 9 launch under new CEO: Apple will hold its first major product event under John Ternus, with new iPhones, Apple Watches and its first foldable phone expected. A revamped Siri AI is also set to debut. [Read (opens in a new tab)]
Business & Tech
Meta reaches $16.7B teen addiction settlement: Meta agreed to resolve claims that its platforms were designed to hook young users. The deal requires major safety changes, including daily usage caps and limits on late-night access. [Read (opens in a new tab)]
Tesla hikes Cybertruck prices as demand weakens: Tesla raised prices on two Cybertruck trims by $5K after first-half sales fell 32.2%. Analysts suggest the move aims to defend margins against lower production volumes. [Read (opens in a new tab)]
Hyundai expands hybrids and US production: Hyundai plans more than 100 new or refreshed models by 2030, with a bigger US hybrid lineup to meet demand. It also aims to build 80% of vehicles sold in America domestically to reduce tariff exposure. [Read (opens in a new tab)]
Chart
Digit of the Day
Gold and Bitcoin ETFs Take In Record $7B as Fiscal Concerns Grow
Gold and Bitcoin are becoming the market’s favorite hedge against a weakening dollar. The two assets saw a record $7B (opens in a new tab) pour into their ETFs over five trading days after plans for more Treasury bond buybacks sent yields and the dollar lower. The move has strengthened demand for scarce assets as concerns over US debt and fiscal policy build.
- SPDR Gold Shares pulled in $3.4B for the week, second only to Vanguard’s S&P 500 ETF, while BlackRock’s Bitcoin ETF added $1.5B
- Gold is up ~14% in August, on pace for its best monthly gain (opens in a new tab) since Sept. 1999, as geopolitical tension and dollar weakness compound the fiscal fear trade.
Scarcity wins: Federal debt has topped $40T, adding fresh fuel to the debasement trade (opens in a new tab) as investors question how long the US can keep borrowing at its current pace. Bridgewater’s Ray Dalio recommends holding gold and some Bitcoin as protection against a potential debt crisis, while Deutsche Bank sees gold climbing past $4.8K. Fundstrat’s Hardika Singh is less convinced, arguing stocks could ultimately prove the more reliable hedge.
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