The Mid-Day Buzz

Sophia Reyes · August 21, 2025 11:57 AM

August 21^st, 2025

U.S. equities opened lower on Thursday, with tech leading the decline. The Nasdaq fell 0.4% early, extending its weekly slide to more than 2%, while the S&P 500, Dow, and Russell 2000 also traded in the red. The weakness follows a downbeat tone across Europe, Japan, and emerging markets.

Big Tech remains under pressure, despite the Nasdaq staging a rebound from session lows on Wednesday as dip buyers stepped in. Short sellers have already booked more than $5 billion in profits from bearish bets against the sector, as mounting AI concerns continue to weigh on sentiment.

Economic Takeaways:

• Bond yields ticked higher, with the U.S. 10-year up 2 basis points.
• The dollar held steady.
• Oil edged firmer, with WTI at $63 a barrel. For the past 10 sessions, US oil futures have been locked in a tight range between about $62 and $65 a barrel.
• Initial jobless claims rose to 235,000 last week, still low by historical standards, but continuing claims climbed to 1.97 million, the highest since November 2021—suggesting displaced workers are struggling to re-enter the job market.
• July building permits data sank for the fourth straight month, indicating malaise in a sector widely seen as a barometer of the broader economy.
• Walmart’s Q2 earnings missed expectations on higher insurance, legal, and restructuring costs, though the retailer boosted full-year sales guidance and emphasized efforts to shield consumers from tariffs. CFO commentary on consumer resilience echoed messages from Target, Lowe’s, and Home Depot earlier this week.
• The Fed’s annual Jackson Hole symposium begins today, with Chair Powell set to speak tomorrow.
• July FOMC minutes showed inflation concerns remained front and center for most officials, but the weaker July payrolls report has spurred more dovish remarks in recent weeks.
• The S&P 500 briefly broke below its 20-day moving average (6,380) yesterday, but a settlement back above that level looked constructive. Breadth remains firm, with 65% of S&P 500 names trading above their 50-day averages—historically solid, and consistent with the index’s modest August gains despite this week’s pullback.
• CME FedWatch now prices a 79% probability of a September rate cut, with a 20% chance the Fed stays on hold.

Manufacturing activity surges to three-year high in August

U.S. business output hit an eight-month high in August, fueled by the strongest manufacturing activity in more than three years. S&P Global’s flash composite PMI rose to 55.4 from 55.1 in July, with the manufacturing PMI climbing to 53.3—the highest in 39 months. By contrast, the services PMI edged down to 55.4, a two-month low.

“The data are consistent with the economy expanding at a 2.5% annualized rate, up from the 1.3% pace seen in the first half,” said Chris Williamson, chief business economist at S&P Global Market Intelligence.

However, both sectors reported their second-largest monthly input price increases since January 2023, raising concerns that consumer inflation could accelerate further above the Fed’s 2% target in the months ahead.

U.S. jobless claims climb to highest since June

Initial claims for unemployment benefits rose to 235,000 in the week ending Aug. 15, the highest level since late May and above economists’ forecast of 225,000. Continuing claims also ticked up to 1.97 million, slightly above expectations, suggesting displaced workers are struggling to secure new jobs.

Headline: U.S. and EU Finalize Tariff Framework

The U.S. and European Union formalized a trade framework Thursday, building on the July 27 deal. The agreement sets a 15% U.S. tariff on most EU imports—including autos, pharmaceuticals, semiconductors, and lumber—but excludes wine and spirits. In return, the EU will remove tariffs on U.S. industrial goods and expand access for American seafood and agriculture. Treasury Secretary Scott Bessent said the administration is satisfied with current tariffs on China, projecting revenues could exceed $300 billion this year to help reduce the federal debt.

On the Move

• Walmart (WMT) slipped 2.5% pre-market after missing EPS expectations, though the report held bright spots. U.S. comparable sales (ex-fuel) rose 4.6%, topping forecasts, while total revenue also beat estimates. Management raised FY26 net sales guidance and cited strength in grocery and health & wellness. On its call, Walmart reiterated its focus on keeping prices low and offsetting tariff pressures, noting consumer impact has been muted so far (Briefing.com).
• Intel (INTC) lost ground Wednesday after CNBC reported large investors are in talks to take equity stakes at a discount. This comes after a brief rally earlier in the week on news of SoftBank’s $2 billion investment.
• Boeing (BA) rose 1.2% after Bloomberg reported discussions to sell as many as 500 planes to China.
• Instacart (CART) dropped more than 2% following a Wedbush downgrade to Underperform from Neutral.
• Renewable energy stocks weakened after former President Trump said he would not approve solar or wind projects, Barron’s reported.
• Nasdaq-100 (NDX) sits nearly 3% below last Wednesday’s record close. Tech laggards Palantir (PLTR) and Oracle (ORCL) steadied somewhat, though PLTR still slipped 1% Wednesday and remains down 17% from its recent high (shares remain up more than 100% YTD, and PLTR gained 1% pre-market today).
• Nordson (NDSN) rallied nearly 5% after earnings beat expectations, while Coty (COTY) plunged more than 20% after a wider-than-expected adjusted loss. HP Enterprise (HPE) rose 2% in pre-market trading following a Morgan Stanley upgrade to Overweight.
• Crypto-linked names including MicroStrategy (MSTR), Coinbase (COIN), and Circle (CRCL) bounced Wednesday but fell again early Thursday alongside Bitcoin, which remains well below recent highs as investor sentiment softens.
• Cracker Barrel (CBRL) shares fell as much as 11% Thursday morning as news outlets reported on the company’s decision to drop the barrel from its logo, the first big brand makeover in nearly 50 years.
• Disney (DIS) has officially rolled out its long-awaited ESPN streaming platform, giving subscribers full access to ESPN programming for the first time without a cable bundle.

What’s Ahead

The Fed’s Jackson Hole symposium opens under a cloud of political tension after President Trump called for Governor Lisa Cook’s resignation—a demand she rejected. With Chair Powell’s speech looming tomorrow, investors can expect a steady stream of media appearances from U.S. and international central bankers today, keeping rate policy firmly in focus. Anticipation over their remarks may keep markets cautious, though sharp moves can’t be ruled out.