What a week! We had a jobs report, a massive earnings beat from Dell (DELL), and a big Tesla (TSLA) Robotaxi event.
So let's dig in:
Dell & the Gang Confirmed AI Demand Is Bonkers
Nvidia (NVDA) impressed with its incredible guidance on its August 26 earnings report.
And Dell (DELL) did the same on Tuesday, forecasting full-year revenues 11% above consensus.
We also had strong AI-driven results this week from Broadcom (AVGO), Ciena (CIEN), Snowflake (SNOW), NetApp (NTAP), and Hewlett-Packard Enterprise (HPE).
Demand for AI infrastructure is just bonkers.
As good as industry earnings are, they'd be even better if not for shortages of inputs like memory and good old-fashioned electricity!
Remember, Nvidia guided for 70% revenue growth vs. Wall Street expectations of 44%.
But its growth would be more like 100% if it could actually meet demand.
And this is a company that is facing increasing competition from its own customers, who are racing to build chips in-house!
David Prince of T3's Inner Circle discussed Dell and other key names in this video:
Memory Is Back on Top
With all the bullish AI news, it's no shocker that memory & storage stocks are leading the market to start September, with the Roundhill Memory ETF (DRAM) up 4%.
DRAM has become one of the most popular ETFs in the market, trading over 23 million shares per day.
SanDisk (SNDK) in particular had a big day on Friday, up 10%.
Maybe we should have listened to Sami Abusaad Tuesday when he made SanDisk his #1 name.
Euphoria Is Missing In Action
The latest AAII Sentiment Survey shows that 39.7% of investors are bullish.
This is the first week of above-average bullishness since July 15.
So does that mean the crowd is positive?
Not exactly. 39.7% isn't even in the neighborhood of euphoric, and it's not far from the long-term average of 37.5%.
Plus, CNN's Fear & Greed Index is at just 42/100.
This is because many of Fear & Greed's inputs like new 52-week highs are at historically low levels.
Euphoria is missing from this market.
The Great Rate Debate Continues
On Friday, President Trump told the Fed to cut rates. Or else he'll stop trade with certain countries that have surpluses.
But what is the market pricing in?
The CME's FedWatch Tool shows the market is now pricing in a 58% chance of a 25 bps rate hike this month.
And it's pricing in an 86% chance of higher rates by year-end.
Next week's CPI and PPI reports should impact expectations.
Next Week Is Oracle and Econo-themed
Earnings season is slowing to a crawl following this week's biggies like Dell (DELL), Palo Alto Networks (PANW), Broadcom (AVGO), and Snowflake (SNOW).
Next week, Oracle (ORCL) is the one to watch for three big reasons:
1) It's an AI bellwether
2) Investors are worried about the company's debt load
3) It will give insights into enterprise software demand
But the real action will be in economics with CPI, PPI, ADP Employment, and the ECB rate decision coming in.
Not to mention, markets will be watching bond auctions because of ongoing concerns over interest rates and the FOMC.
The Pristine Mentorship Is Open
Sami Abusaad and James Rich Young's Pristine Mentorship is open!
In this video, they take you through how to build a trading plan, then tell you all about the program.
Highly recommended:
