U.S. Indexes closed lower on Tuesday, with the NASDAQ 100 leading the downside amid pronounced weakness in Technology. Semiconductor and memory names were particularly hard hit as US yields remained elevated. Industrials and Materials also lagged, while Energy, Health Care and Consumer Staples outperformed. The recent backup in long-end yields has been weighing on broader market sentiment, particularly after the 30-year rose to its highest level in around 19 years on Monday. Higher long-term borrowing costs may be reducing the attractiveness of debt-backed financing for hyperscaler capex, potentially weighing on the outlook for AI infrastructure spending and, in turn, demand for semiconductors. Higher yields also present a valuation headwind for growth stocks more broadly. The Vanguard S&P 500 Growth ETF (VOOG) fell over 1%, while the Semiconductor ETF (SOXX) dropped around 5% and the Memory ETF (DRAM) tumbled over 8%. Regarding data, US Import and Export Prices were cooler than expected, adding to the string of softer July inflation reports ahead of the PCE report due later this month. The weekly ADP Employment Change remained subdued at around 9.5k vs the prior week’s 8.25k. On housing, Starts declined 12%, below expectations, while the more forward-looking Building Permits rose 5%, topping forecasts. Industrial and Manufacturing Production were broadly in line. In wake of the data, the Atlanta Fed GDPNow estimate for Q3 was revised down to 4.0% from 4.3%. Crude prices settled in the green following choppy trade. US President Trump said there are currently no talks with Iran and none are planned, while stating the blockade remains in full force and that the Strait of Hormuz is open and operating. In FX, the Dollar gained as equities declined, with the risk-off tone weighing on the antipodean currencies. Attention now turns to the FOMC Minutes for an indication of how far the hawkish sentiment extended beyond the three dissenters at the July meeting, including whether other officials would have supported a hike. However, Chair Warsh’s aversion to forward guidance may limit clues on future decisions, while participants could look through the minutes given the softer NFP and inflation data released since the meeting. US import prices fell 0.4% M/M in July (exp. +0.1%, prev. -0.3%), the largest monthly decline since May 2025, as a 7.2% decline in fuel import prices more than offset a 0.4% increase in nonfuel prices. Despite the headline decline, the underlying details were firmer, with capital goods prices rising 0.9%, driven by computers, peripherals and semiconductors, industrial and service machinery, and civilian aircraft, while food import prices rose 0.9%. Notably, import prices from China increased 0.8%, the largest monthly rise since July 2008. Export prices fell 1.3% M/M (exp. +0.2%, prev. -0.7%), driven by a 1.5% decline in non-agricultural prices, particularly industrial supplies and materials (-4.1%), while agricultural export prices rose 1.0%. On an annual basis, import prices remained elevated at +5.9% Y/Y, including a 4.5% rise in nonfuel prices, while export prices were up 8.2%. Oxford Economics said that despite the still-sizeable annual increase, it expects import price inflation to moderate, although energy prices are likely to remain volatile until a durable peace is reached between the US and Iran. Industrial Production and Manufacturing Production both rose 0.2% in July, after 0.3% increases in June, with the former shy of the expected 0.3% and the latter matching expectations. Consumer goods output fell 0.4% in July, led by a 1.4% drop in durables. Business equipment rose 0.8%, defence and space equipment increased 1.8%, while materials gained 0.3%. Manufacturing output rose 0.2%, with durable goods up 0.7% despite a 2.1% fall in motor vehicles and parts; nondurables fell 0.4%. Mining output rose 0.2%, and utilities increased 0.5%. Meanwhile, the capacity utilisation rate rose to 76.3% from 76.2%, as expected. Pantheon Macroeconomics says consumer demand is likely to slow in H2 2026 as a fleeting boost from tax refunds fades, and external demand is tepid. The firm thinks that the underlying trend in manufacturing outside of a few tech-adjacent industries likely remains relatively subdued. Pending Home Sales fell 2.3% M/M in July, against the expected rise of 0.3%; M/M sales declined across all four major US regions. NAR Chief Economist Yun notes the highest mortgage rates of the year hit right in the middle of summer, and that is pulling back contract signings, and home prices are at record highs. Yun adds, job gains should bring more buyers into the market, and currently pending contracts are 30% below their pre-pandemic 2019 level, while payroll employment is 5% above. As such, Yun notes the gap points to sizable pent-up demand that should be unleashed in the coming years as more supply reaches the market and affordability improves. Elsewhere, Oil closed higher by 0.5% while Gold gave back some of its recent gains with a loss of 1.65%.
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For anyone following my Platinum Service it made 150 points yesterday and is now ahead by 1860 points for August after closing July with a gain of 8031 points, after ending June with a new record of 10527 points after ending May with a loss of 1104 points, having ended April with a gain of 1730 points, after ending March with a massive gain of 9002 points, having closed February with a strong gain of 5482 points after ending January with a gain of 4757 points, having closed December with a gain of 2599 points, after ending the month of November with a gain of 4542 points, after ending October with a nice gain of 5110 points after closing September with a gain of 3774 points while ending August with a gain of 3362 points after closing July with a gain of 3753 points after closing June with a gain of 3530 points, having closed May with a gain of 3606 points, after closing April with a gain of 7685 points after closing March with a gain of 2254 points while closing February with a gain of 4180 points. January ended with a gain of 2768 points while 1997 points were gained in December. October ended with a gain of 2179 points, after closing September with a gain of 4402 points, following a loss of 301 points in August. July gained 1908 points while June saw a gain of 2074 points. The Platinum Service made a previous record 9619 points in October 2022. Since I started this New Platinum Service in June 2015 it has averaged a monthly gain of over 2300 points. I have a YouTube Channel which contains recent interviews I have given This can be viewed by clicking HERE Please subscribe to this for new interview notification
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