Markets
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Luke Kawa

The AI spending boom is eating the US economy


Neil Dutta at Renaissance Macro flagged this eye-popping stat after the advance release of second-quarter US GDP data:

“So far this year, AI capex, which we define as information processing equipment plus software has added more to GDP growth than consumers’ spending,” he tweeted.

The US consumer makes up about 70% of the economy. Over the long term, that’s been the undisputed engine of growth. But these two segments that make up 6% of GDP have been playing a bigger role in fueling the expansion so far this year, on average.

I am among the bigger “the stock market IS the economy” people you will ever meet (because I enjoy holding views grounded in data).

But I was beginning to question that a little in light of some of the bifurcation in the stock market, with some more consumer-oriented stocks (Chipotle and UPS, for instance) plummeting after earnings versus the continued strength in AI-linked names. All the while, the S&P 500 continued to grind higher to fresh record highs.

It was getting more tenuous to hold the position that the stock market is a good reflection of the economy unless AI was supplanting the consumer as “the economy.”

Well, since this capex binge shows that in the first half, AI has indeed been eating the US economy… priors confirmed, now back to work everyone.

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Tasha Matsumoto
7h
Stocks rebound as the price of oil retreats

Every sector traded higher, with tech leading gains on increased optimism that tankers will be able to pass through the Strait of Hormuz.

Aberdeen Angus Bull
Luke Kawa
8h
Nvidia briefly spikes after Jensen Huang sees at least $1 trillion in AI chip sales through 2027

The stock then gave it all up and then some.

Jensen Huang at 2026 GTC in San Jose
markets
Luke Kawa

Oil’s retreat propels US stocks higher

Front-month West Texas Intermediate futures are down more than 4%, while Brent futures are off more than 2% as of 1:25 p.m. ET as traders glom on to some optimistic signs about the flow of oil through the all-important Strait of Hormuz:

  • A Pakistani-owned tanker passed through the strait this weekend while broadcasting its signal, per Reuters, “indicating ‌that some countries are able to negotiate safe passage for their vessels despite the U.S.-Israeli war on Iran.”

  • US President Donald Trump said that some “fairly local” countries would soon be helping ships traverse the strait (while having added that other countries are “not enthusiastic” about the prospect of participating).

The SPDR S&P 500 ETF and Invesco QQQ Trust are both up over 1% amid oil’s retreat.

That being said, the news flow is far from universally positive.

Reuters reports that the UAE’s crude output has been cut in half since the Mideast conflict started; Bloomberg says Kuwait’s production has suffered a similar decline.

Trump urges allies to help reopen Strait of Hormuz as tanker traffic nearly vanishes

Trump urges allies to help reopen Strait of Hormuz as tanker traffic nearly vanishes

  • A Pakistani-owned tanker passed through the strait this weekend while broadcasting its signal, per Reuters, “indicating ‌that some countries are able to negotiate safe passage for their vessels despite the U.S.-Israeli war on Iran.”

  • US President Donald Trump said that some “fairly local” countries would soon be helping ships traverse the strait (while having added that other countries are “not enthusiastic” about the prospect of participating).

The SPDR S&P 500 ETF and Invesco QQQ Trust are both up over 1% amid oil’s retreat.

That being said, the news flow is far from universally positive.

Reuters reports that the UAE’s crude output has been cut in half since the Mideast conflict started; Bloomberg says Kuwait’s production has suffered a similar decline.

markets
Matt Phillips

Sandisk and memory stocks rip ahead of Nvidia CEO’s speech

Memory stocks such as Sandisk, Micron, and disk drive makers Western Digital and Seagate sprinted ahead Monday, as this week’s big AI conference for tech bellwether Nvidia gets underway with a speech from the CEO slated for this afternoon.

As Luke Kawa pointed out earlier, CEO Jensen Huang’s speechifying at high-profile company announcements or industry events hasn’t always been a good thing for Nvidia shares. (The chip designer is holding its GPU Technology Conference, or GTC, this week.)

But Huang’s pronouncements have, at times, been pretty dang helpful for share prices of some companies in the orbit of the AI gods. Perhaps foremost among them are the memory stocks that have blasted toward the top of the S&P 500 in terms of price performance in recent years.

Case in point: the nearly 30% gain that Sandisk posted on January 6, the day after Huang’s keynote speech at the Consumer Electronics Show in Las Vegas, in which he spotlighted memory as a key bottleneck constraining the AI build-out. (Fellow memory plays Western Digital, Seagate Technology Holdings, and Micron also posted double-digit gains that day.)

Memory stocks have been the highest-profile outlet for bullish AI industry impulses this year, and notable comments from Huang could put the wind back in their sails after they had slowed in recent weeks.

Of course, there are also other things happening in the sector, such as Micron’s announcement Sunday that it completed an acquisition of a new manufacturing site in Taiwan.

Either way, memory stocks are pushing higher after having exhaled a bit lately.

What Wall Street’s looking for from Jensen Huang’s keynote GTC address

What Wall Street’s looking for from Jensen Huang’s keynote GTC address

But Huang’s pronouncements have, at times, been pretty dang helpful for share prices of some companies in the orbit of the AI gods. Perhaps foremost among them are the memory stocks that have blasted toward the top of the S&P 500 in terms of price performance in recent years.

Case in point: the nearly 30% gain that Sandisk posted on January 6, the day after Huang’s keynote speech at the Consumer Electronics Show in Las Vegas, in which he spotlighted memory as a key bottleneck constraining the AI build-out. (Fellow memory plays Western Digital, Seagate Technology Holdings, and Micron also posted double-digit gains that day.)

Memory stocks have been the highest-profile outlet for bullish AI industry impulses this year, and notable comments from Huang could put the wind back in their sails after they had slowed in recent weeks.

Of course, there are also other things happening in the sector, such as Micron’s announcement Sunday that it completed an acquisition of a new manufacturing site in Taiwan.

Either way, memory stocks are pushing higher after having exhaled a bit lately.

Luke Kawa
13h
What Wall Street’s looking for from Jensen Huang’s keynote GTC address

GTC may stand for GPU Technology Conference, but investors are looking for Nvidia to go beyond GPUs.

Nvidia Holds Its GTC: Artificial Intelligence Conference

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