Some of the tech titans, those long seen as the architects of post-pandemic economic buoyancy, are wobbling. Advanced Micro Devices (AMD) stumbled. Revenue from its AI chip segment came in underwhelming, prompting a swift 6.5% drop in premarket trading. Then came Super Micro, a name as synonymous with AI server infrastructure as Nvidia is with chips. A missed fourth-quarter revenue estimate sent its shares plunging 17%, dragging down fellow travelers Dell Technologies and HP Enterprise in the process. While artificial intelligence was expected to be the main engine driving this earnings season, and some companies have indeed delivered solid results, the disappointing showings from AMD and Super Micro have tempered those hopes.

And yet, optimism persists. In a market conditioned to seek reassurance from the Federal Reserve like a toddler seeks a nightlight, the mere suggestion of rate cuts has a tranquilizing effect. The CME FedWatch tool now shows an 87.5% probability of a September cut. As macroeconomic jitters grow—from tepid job growth to ballooning input costs—investors are betting that the Fed will blink.

But that's a dangerous game. Tuesday's market slide, triggered by a surprise stall in the U.S. services sector and the sharpest spike in input costs in nearly three years, was a reminder that rate cuts aren't a magic wand. They're a sedative. Useful, yes, but not curative. Beneath the surface, the economy is flashing contradictory signals: inflationary pressure is rising, labor strength is softening, and corporate America is grappling with the early tremors of tariff realignment.

President Donald Trump has re-entered the policy conversation with a vengeance. In characteristic flourish, he proposed a "small tariff" on pharmaceutical imports that could balloon to triple digits over time. Semiconductor imports, too, may face fresh levies "in the next week or so."

Meanwhile, Beijing's trade truce with the U.S. is set to expire on August 12. Negotiations continue, but the tone has hardened. With Trump hinting at a reshuffle of the Federal Reserve leadership—vowing to announce a successor to Governor Adriana Kugler and narrowing his list to replace Chair Jerome Powell—the fragile equilibrium between politics and policy could soon tilt again.

The ripple effects of the current climate of uncertainty are already visible. Uber, despite announcing a $20 billion share buyback and forecasting third-quarter bookings above expectations today, fell 2% before regaining some ground to +1.2%. Walt Disney beat earnings estimates and raised guidance, watched its stock dip 1.5%.

In the midst of it all, Arista Networks offered a rare glimmer. The cloud networking firm surged 12.6% after forecasting better-than-expected revenue. It was a welcome anomaly, a bright spot in an otherwise muted earnings season.

Today's results include Costco, Walt Disney and McDonald's. Europe is not to be outdone, with financials Generali and Commerzbank, fallen healthcare star Novo Nordisk, and iconic German companies Siemens Energy and Beiersdorf. In the new economy, Uber Technologies, Shopify, AppLovin and DoorDash are on the agenda.

In Asia-Pacific, the Japanese market gained 0.5%, helped by the automotive sector, amid rumors that the sector would receive favorable treatment in trade relations with the United States. China rose slightly, while South Korea and India fell moderately. Australia, supported by the mining sector and the prospect of continued Sino-US negotiations, gained 0.8%. Futures pointed modestly higher on Wednesday, with the Dow Jones up 0.30%, the S&P 500 rising 0.17%, and the Nasdaq 100 inching up 0.1%t. Europe is mixed, with the Stoxx Europe 600 down 0.1%.

Today's economic highlights:

On today's agenda: factory orders in Germany and private sector jobs in France; retail orders in Ecuador; in the United States, DOE crude oil inventories. See the full calendar here.

  • Dollar index: 98,370
  • Gold: $3,361
  • Crude Oil (BRENT): $68.55 (WTI): $66.04
  • United States 10 years: 4.23%
  • BITCOIN: $114,214

In corporate news:

  • Accenture has invested in Snorkel AI to speed up AI deployment in regulated industries, particularly financial services.
  • Emerson Electric raised its annual profit forecast slightly on stronger intelligent devices demand and reduced tariff risks, despite a 7% share drop.
  • NiSource beat Q2 profit estimates due to strong electricity demand from AI and crypto data centers and raised its annual earnings forecast range.
  • McDonald's reported 7% EPS growth in Q2, driven by strong international sales and promotions, with loyalty program sales hitting $33 billion over the last year.
  • Rockwell Automation lifted the lower end of its annual profit outlook, supported by sustained demand for automation solutions and tariff mitigation strategies.
  • NRG Energy surpassed Q2 profit estimates and signed a 295 MW deal to power data centers, benefiting from rising Texas electricity demand.
  • Global Payments exceeded Q2 earnings expectations thanks to robust performance in its merchant and issuer solutions units and reaffirmed plans to close the Worldpay acquisition in 2026.
  • Apollo Global Management will acquire a majority stake in Stream Data Centers, targeting a 650 MW power capacity buildout.
  • Blackstone has agreed to acquire Enverus in a $6.5 billion deal, strengthening its digital energy analytics portfolio.
  • CDW beat Q2 estimates on sustained IT demand from healthcare and government sectors, with sales rising to $5.98 billion.
  • Shopify reported a tenfold jump in profit and forecasted Q3 revenue above expectations, as merchant sales surged across North America, Europe, and Asia.
  • The Carlyle Group posted a 26% rise in Q2 profit, driven by higher fee revenue and growing AUM, and raised fresh capital while maintaining a strong investment pipeline.
  • Walt Disney raised its full-year EPS target again after Q3 earnings beat estimates, fueled by streaming gains, parks growth, and a 10% ESPN stake deal with the NFL.
  • Cencora lifted its annual profit outlook as Q2 earnings exceeded estimates, boosted by strong specialty drug and weight-loss therapy demand.
  • Omnicom and Interpublic cleared UK antitrust hurdles for their $13.25 billion merger, setting the stage for the creation of the world's largest ad agency.
  • Nvidia has rejected a US proposal for location verification in its chips.
  • Tesla sales in Europe are declining as BYD gains market share.
  • Lucid Group has cut its annual production forecast and missed revenue estimates.
  • Caterpillar second-quarter profit declined due to sluggish equipment demand and tariff impacts.
  • OpenAI is in discussions for a potential secondary stock sale that could value the company at around $500 billion.
  • KKR has increased its bid for Spectris to $5.6 billion.
  • Embraer reaffirmed its 2025 outlook and reported a second-quarter net loss.
  • Uber matched Q2 EPS expectations but missed on revenue; it unveiled a $20 billion buyback, guided for stronger Q3 bookings, and highlighted growth from its loyalty program.
  • EU regulators approved a joint venture between Foxconn and Alphabet, and separately cleared KKR's acquisition of Sweden's Karo Healthcare.
  • Iron Mountain reported record Q2 revenue and raised its FY outlook, driven by over 30% growth in data center and digital businesses.
  • Dynatrace exceeded Q1 estimates and raised its full-year forecast, citing strong expansion deals and demand for its AI-powered platform.
  • Bentley Systems beat Q2 estimates with a 10.2% revenue rise, supported by strong infrastructure investment demand.
  • Super Micro and AMD shares slid after both companies reported weaker-than-expected data center results, shaking investor faith in their AI growth narratives.

Analyst Recommendations:

  • AMD (Advanced Micro Devices) CTBC Securities Investment Service Co LTD upgrades to buy from add with a price target raised from USD 110 to USD 200.
  • Carmax, Inc. JP Morgan downgrades to neutral from underweight with a target price reduced from USD 65 to USD 58.
  • Chevron Corporation Freedom Broker downgrades to hold from buy with a target price of USD 165.
  • Comerica Incorporated Jefferies upgrades to hold from underperform with a price target raised from USD 50 to USD 70.
  • Exxon Mobil Corporation Freedom Broker downgrades to hold from buy with a target price of USD 123.
  • Incyte Corporation Wells Fargo upgrades to overweight from equalweight with a price target raised from USD 67 to USD 89.
  • KLA Corporation Zacks downgrades to neutral from outperform with a price target reduced from USD 1057 to USD 930.
  • Medtronic Plc Zacks upgrades to neutral from underperform with a price target raised from USD 85 to USD 94.
  • Snap Inc. Citizens downgrades to market perform from market outperform.
  • Topbuild Corp. Seaport Global upgrades to buy from neutral with a target price of USD 450.
  • Acadia Healthcare Company, Inc. Jefferies maintains its buy recommendation and reduces the target price from USD 58 to USD 44.
  • Air Lease Corporation JP Morgan maintains its overweight recommendation and raises the target price from 59 to USD 72.
  • Arista Networks Inc. Evercore ISI maintains its outperform recommendation and raises the target price from USD 120 to USD 150.
  • Astera Labs, Inc. Deutsche Bank maintains its buy recommendation and raises the target price from USD 105 to USD 160.
  • Bellring Brands, Inc. Truist Securities maintains its hold recommendation with a price target reduced from USD 60 to USD 40.
  • Boeing DZ Bank AG Research maintains its buy recommendation and raises the target price from USD 215 to USD 260.
  • Caterpillar Inc. Truist Securities maintains its buy recommendation and raises the target price from USD 414 to USD 507.
  • CSX Corporation Loop Capital Markets maintains its hold recommendation with a price target raised from 28 to USD 37.
  • Cummins Inc. Bernstein maintains its market perform recommendation with a target price raised from 319 to USD 385.
  • Gartner, Inc. Baird maintains its outperform recommendation and reduces the target price from USD 540 to USD 316.
  • Globalfoundries, Inc. Jefferies maintains its buy recommendation and reduces the target price from USD 50 to USD 38.
  • IDEXX Laboratories, Inc. Nephron Research LLC maintains its buy recommendation and raises the target price from USD 552 to USD 724.
  • Klaviyo, Inc. Piper Sandler & Co maintains its overweight recommendation and raises the target price from USD 40 to USD 55.
  • Match Group, Inc. Citigroup remains neutral recommendation with a price target raised from USD 30 to USD 37.
  • Meta Platforms, Inc. Daiwa Securities maintains its buy recommendation and raises the target price from USD 719 to USD 900.
  • Palantir Technologies Inc. HSBC maintains its hold recommendation with a price target raised from 111 to USD 181.
  • Rocket Companies, Inc. Deutsche Bank maintains its buy recommendation and raises the target price from USD 16 to USD 22.
  • Super Micro Computer, Inc. Raymond James maintains its outperform recommendation and raises the target price from 41 to USD 53.
  • Transocean Ltd. Pareto Securities maintains its hold recommendation with a price target reduced from 4 to USD 3.
  • UnitedHealth Group Inc. JP Morgan maintains its overweight recommendation and reduces the target price from 418 to USD 310.
  • Warner Bros. Discovery, Inc. Morgan Stanley maintains its market weight recommendation and raises the target price from 10 to USD 13.