August 7th, 2025
Nasdaq Climbs as Nvidia and Apple Rally on Chip Tariff Exemptions
Markets moved higher as investor hopes for a Federal Reserve rate cut gained traction. A series of comments from Fed officials—including Minneapolis Fed President Neel Kashkari, typically viewed as one of the more hawkish voices—struck a noticeably more dovish tone, fueling optimism that monetary easing could come sooner than expected.
The Nasdaq Composite rose 0.4% on Thursday, powered by gains in Nvidia and Apple, after former President Donald Trump revealed a new 100% tariff on imported semiconductor chips—with a key carve-out for companies manufacturing in the U.S.
Nvidia advanced over 1%, and AMD surged 6% following the announcement. The VanEck Semiconductor ETF (SMH) also gained more than 1%.
Meanwhile, the broader market lagged. The S&P 500 hovered just below the flatline, and the Dow Jones Industrial Average dropped 288 points, or 0.7%, weighed down by a 2% slide in Caterpillar shares. The heavy machinery giant warned that tariffs could negatively impact its operations.
Economic Takeaways:
- Bond yields edged lower Thursday, with the 10-year Treasury yield dipping roughly 1 basis point to 4.23%. The benchmark yield has seen a steep decline over the past two weeks as softer labor market data and growing expectations of a Fed rate cut in September weigh on investor sentiment.
- U.S. labor productivity remains resilient—second-quarter growth came in at an annualized 2.4%, outpacing estimates of 2.0%.
- According to Yale’s Budget Lab, the average U.S. tariff rate has surged from 2.3% to approximately 18.3%, raising concerns about inflationary pressure. Still, the wave of carve-outs has helped ease market fears of worst-case trade scenarios.
- As second-quarter earnings season winds down, corporate results have largely exceeded expectations. Roughly 87% of S&P 500 companies have reported, with 82% beating analyst estimates and delivering an average surprise of 8.1%.
- On the technical front, the S&P 500 held up well, bouncing off the 6,300 support level and closing above its 20-day moving average of 6,315—a key line it’s respected for much of the summer.
- Looking ahead, market expectations for a Fed rate cut in September continue to climb. The CME FedWatch Tool now shows a 93% probability—up sharply from just 38% a week ago, prior to last Friday’s weak July jobs report.
Trump Calls for Intel CEO to ‘Resign Immediately’ Amid China Ties Scrutiny
President Donald Trump called for the immediate resignation of Intel (INTC) CEO Lip-Bu Tan early Thursday, citing concerns over Tan’s ties to Chinese companies.
“The CEO of INTEL is highly CONFLICTED and must resign, immediately,” Trump posted on Truth Social, the platform he owns. “There is no other solution to this problem. Thank you for your attention to this problem!”
Tan, who took over as Intel’s CEO in March following Pat Gelsinger’s departure, was initially met with optimism on Wall Street. The company’s stock jumped as much as 15% following the leadership change, and many analysts viewed Tan as the best bet to revive the chipmaker’s fortunes after years of lagging performance in the AI race.
However, shares of Intel fell more than 3% following Trump’s remarks.
In April, Reuters reported that Tan’s venture capital firm, Walden International, holds extensive investments in Chinese tech firms. The report revealed that the firm “remains invested in 20 funds and companies alongside Chinese government funds or state-owned enterprises, according to Chinese corporate databases.”
Tan has held executive roles at more than a dozen semiconductor companies, including a high-profile stint as CEO of Cadence Design Systems.
Trump’s comments followed a letter sent Wednesday by Sen. Tom Cotton (R-Ark.), one of his closest Senate allies, who raised similar concerns in a note to Intel’s board chair. “Intel is required to be a responsible steward of American taxpayer dollars and to comply with applicable security regulations,” Cotton wrote, citing Intel’s nearly $8 billion in CHIPS Act funding. “Mr. Tan’s associations raise questions about Intel’s ability to fulfill these obligations.”
On the Move
- Eli Lilly (LLY) tumbled 7% in early trading, despite beating earnings expectations and raising its 2025 outlook. Investors focused instead on underwhelming data from its GLP-1 obesity pill trial, where participants lost up to 12% of body weight—just shy of expectations. A high dropout rate, seen in both the treatment and placebo groups, also added pressure. In contrast, rival Novo Nordisk (NVO) surged 8%, capitalizing on the setback.
- Taiwan Semiconductor (TSM) popped 4.6% after confirming it would be exempt from the newly announced U.S. chip tariffs due to its U.S.-based manufacturing presence.
- Ralph Lauren (RL) gained 2.6% following a strong earnings and revenue beat, while DoorDash (DASH) rallied 8% premarket on better-than-expected quarterly results.
- DraftKings (DKNG) soared nearly 7% after posting impressive earnings, continuing momentum in the online gaming sector.
- Airbnb (ABNB) dropped 6.5% premarket, despite surpassing Wall Street’s estimates. Investors reacted negatively to the company’s cautious forward guidance.
- Advanced Micro Devices (AMD) fell 6.4% Wednesday as its earnings failed to excite. While the company projected solid guidance, its 14% data center growth paled in comparison to Nvidia’s (NVDA) recent 73% gain, dampening enthusiasm.
- Super Micro Computer (SMCI) cratered 18% after disappointing guidance and margin contraction. Analysts quickly voiced concern over the company’s outlook.
- Fortinet (FTNT) plunged 21% in early trading after updating its firewall refresh cycle. Three analysts downgraded the stock following the announcement, according to Bloomberg.
- Shopify (SHOP) rocketed 22% yesterday after blowing past earnings estimates. The company revealed that tariff impacts were less severe than expected, despite some merchants raising prices.
- Apple (AAPL) continued its rally, up 3% this morning after a 5% gain Wednesday. The tech giant announced a major U.S. investment and unveiled a chip technology partnership with Samsung. CEO Tim Cook’s appearance at a White House event also signaled improving relations with President Trump, which helped buoy investor confidence.
- Crypto-related stocks moved higher as Bitcoin (BTC) rose nearly 1%. MicroStrategy (MSTR) and Coinbase (COIN) saw early gains between 1% and 3%, though digital assets remain largely range-bound over the past month.
- S. Treasury yields edged higher after a weak 10-year note auction, with several more auctions scheduled throughout the day.
- Tesla (TSLA) rose 3.6% Wednesday after two competing EV firms posted weaker-than-expected earnings. Still, Tesla shares remain down 21% year-to-date.
- Intel (INTC) slipped nearly 3% following a social media post by Donald Trump suggesting CEO Lip-Bu Tan should step down. The comment may have been linked to questions raised by Sen. Tom Cotton over Tan’s connections to Chinese companies, according to CNBC.
What’s Ahead
Looking ahead, earnings season continues with Under Armour (UA) set to report on August 8. On August 11, Barrick Mining (B) and AMC (AMC) are expected to release their results. A busy August 12 will bring the July Consumer Price Index (CPI) alongside earnings from Cardinal Health (CAH), Cava Group (CAVA), Circle Internet (CRCL), and CoreWeave (CRWV). Cisco (CSCO) is scheduled to report on August 13, followed by the July Producer Price Index (PPI) and earnings from Deere (DE), JD.com (JD), Tapestry (TPR), and Applied Materials (AMAT) on August 14.
Next Tuesday marks a critical trade deadline, with over 70 countries confronting heightened U.S. import tariffs. All eyes, however, are on the Trump administration’s decision regarding China. The clock is ticking for the U.S. and China to strike a deal, but President Trump has yet to signal whether he’ll grant a 90-day extension—an option floated last week by top economic advisers.
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