markets

Luke Kawa8/1/25

Tariffs, data, earnings are a trifecta of troubles sending the S&P 500 sharply lower

Let’s run through everything ailing the US stock market on Thursday, with the SPDR S&P 500 ETF poised for its first 1% loss since mid-June:

Tariffs: President Donald Trump is planning to follow through with additional tariff hikes for countries that didn’t reach deals with the US. A UBS basket of “Trump tariff losers” is down 2.4% as of 10:15 a.m. ET.
Data: Nonfarm payroll growth in the US disappointed, coming in at 73,000 in July versus an expected 104,000. To make matters worse, there were also massive negative revisions to the prior two months. The July ISM Manufacturing report also posted a big miss, coming in at 48 while economists had anticipated 49.5. Readings below 50 imply a contraction in the sector. These two reports had led to mounting worries about the potential for everything else in the economy to roll over, outweighing the ongoing AI boom — especially when the aforementioned tariff shock threatens to heap additional pressure on economic activity.
Earnings: There are some good and bad ones out there, but the bad ones really sting. Amazon is single-handedly driving nearly 20% of the SPY’s decline as of 10:30 a.m. ET, as even the overwhelming AI demand it’s seeing isn’t strong compared to its rivals.

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J. Edward Moreno4m

Arm says its in-house AI chip will generate billions in revenue

British semiconductor firm Arm rose more than 13% in premarket trading after it announced Tuesday evening that it would create a new AI chip in partnership with Meta, which its CEO says should lead to a boom in sales.

Speaking at an event in San Francisco, Arm CEO Rene Haas said the new chip alone is expected to generate $15 billion in annual revenue by 2031. Meanwhile, the CEO said that the company expects intellectual property sales, currently its main revenue driver, to hit $10 billion by then.

In total, Arm projects it will hit $25 billion in annual sales in five years, compared to the $4.9 billion analysts expect it to report for its current fiscal year, which ends this month. It also expects to report $9 earnings per share by then, compared to the $1.75 the Street is penciling in for FY2026.

Meta and Arm team up to build a new class of data center chips

Speaking at an event in San Francisco, Arm CEO Rene Haas said the new chip alone is expected to generate $15 billion in annual revenue by 2031. Meanwhile, the CEO said that the company expects intellectual property sales, currently its main revenue driver, to hit $10 billion by then.

In total, Arm projects it will hit $25 billion in annual sales in five years, compared to the $4.9 billion analysts expect it to report for its current fiscal year, which ends this month. It also expects to report $9 earnings per share by then, compared to the $1.75 the Street is penciling in for FY2026.

Dollar Sign Crushing People

Retail traders sold more stocks than they bought for the first time since 2023

Monday was the first day since November 2023 where retail investors flipped to selling.

J. Edward Moreno56m

markets

Nate Becker & Matt Phillips15h

Oil drops, yields fall, and stocks rise on reports the US has sent Iran a plan to end war

Oil, stock, and bond markets flipped their positions yesterday and continued into premarket trading Wednesday, as investors digest the latest reports on a potential wind-down of the war in Iran, with The New York Times reporting that the US has sent Iran a 15-point plan to end the conflict.

While the details of the proposal remain unclear, it reportedly includes US demands from prior nuclear talks in Geneva and has been shared with Israel — though Israeli officials remain skeptical that Iran will agree to all conditions, according to Axios.

At the time of writing, international benchmark Brent crude futures are down around 4% to ~$100 a barrel, while US benchmark West Texas Intermediate futures also sank roughly to $88 a barrel. Yields on two-year and 10-year Treasuries continued their overnight declines and theSPDR S&P 500 ETF extended its after-hours rally into premarket trading.

Global markets have breathed a sigh of relief, with the broader Stoxx Europe 600 up 1.3% and all sectors (besides oil and gas stocks) in the green. Asia-Pacific markets closed higher Wednesday, with Japan’s Nikkei 225 and South Korea’s Kospi gaining 2.9% and 1.6%, respectively. S&P 500 futures rose 0.84% and Nasdaq 100 futures gained 1%.

Spot gold and silver both jumped roughly 1.8% as the decline in oil prices eased inflation fears.

From the Times’ report yesterday:

“The United States has sent Iran a 15-point plan to end the war in the Middle East, according to two officials briefed on the diplomacy, reflecting the Trump administration’s eagerness to find an offramp from the conflict as it grapples with its economic fallout.

It was unclear how widely the plan, delivered by way of Pakistan, had been shared among Iranian officials and whether Iran was likely to accept it as a basis for negotiations. Nor was it clear whether Israel, which has been bombing Iran together with the United States, was on board with the proposal.

But the delivery of the plan showed that the administration was ramping up efforts to conclude a war, now in its fourth week, that has drawn in several other countries.”

Some individual shares had outsized reactions to the news. Gold miners Freeport-McMoRan and Newmont, which have been battered since the war started, are still rising this morning. Ammonia maker CF Industries — which had risen on expectations of rising prices for fertilizer products linked to the closure of the Strait of Hormuz — is going the other way.

US natural gas producers such as APA Corporation, EOG Resources, Devon Energy, and Diamondback Energy declined after-hours on the news.

United States Said to Have Sent Iran a Plan to End the Middle East War

While the details of the proposal remain unclear, it reportedly includes US demands from prior nuclear talks in Geneva and has been shared with Israel — though Israeli officials remain skeptical that Iran will agree to all conditions, according to Axios.

At the time of writing, international benchmark Brent crude futures are down around 4% to ~$100 a barrel, while US benchmark West Texas Intermediate futures also sank roughly to $88 a barrel. Yields on two-year and 10-year Treasuries continued their overnight declines and theSPDR S&P 500 ETF extended its after-hours rally into premarket trading.

Global markets have breathed a sigh of relief, with the broader Stoxx Europe 600 up 1.3% and all sectors (besides oil and gas stocks) in the green. Asia-Pacific markets closed higher Wednesday, with Japan’s Nikkei 225 and South Korea’s Kospi gaining 2.9% and 1.6%, respectively. S&P 500 futures rose 0.84% and Nasdaq 100 futures gained 1%.

Spot gold and silver both jumped roughly 1.8% as the decline in oil prices eased inflation fears.

From the Times’ report yesterday:

“The United States has sent Iran a 15-point plan to end the war in the Middle East, according to two officials briefed on the diplomacy, reflecting the Trump administration’s eagerness to find an offramp from the conflict as it grapples with its economic fallout.

It was unclear how widely the plan, delivered by way of Pakistan, had been shared among Iranian officials and whether Iran was likely to accept it as a basis for negotiations. Nor was it clear whether Israel, which has been bombing Iran together with the United States, was on board with the proposal.

But the delivery of the plan showed that the administration was ramping up efforts to conclude a war, now in its fourth week, that has drawn in several other countries.”

Some individual shares had outsized reactions to the news. Gold miners Freeport-McMoRan and Newmont, which have been battered since the war started, are still rising this morning. Ammonia maker CF Industries — which had risen on expectations of rising prices for fertilizer products linked to the closure of the Strait of Hormuz — is going the other way.

US natural gas producers such as APA Corporation, EOG Resources, Devon Energy, and Diamondback Energy declined after-hours on the news.

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GameStop seesaws on Q4 results

The video game and collectibles retailer just reported Q4 results.

Luke Kawa, Max Knoblauch16h

Tasha Matsumoto

Stocks close lower after fluctuating as traders digest war updates

Stocks pared steeper losses on hopes of US-Iran talks, but were unable to maintain gains on reports that the US is deploying 3,000 troops to the Middle East.

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