US Stock Market Review 8.5: S&P Continues to Hit New Highs, SPCX and AMD Plunge After Earnings!
US stocks continued to soar yesterday!
The S&P 500 hit new highs with great force!
These are the points mentioned before: The three major uncertainties are clear, and it's a 'TACO' scenario where all bad news has been priced in. The pressure at the current level is actually quite significant, so there might be some pullback in the short term.
Geopolitics:
Treasury Secretary Bessent stated on Tuesday that an agreement regarding the Strait of Hormuz may be reached on the 4th or 5th.
Trump said today at noon: Negotiations with Iran are progressing very smoothly, and the outcome will be clear within the next 48 hours.
Iran is considering allowing European countries to conduct mine clearance in the Strait of Hormuz, which may be part of the agreement.
Big Tech Performance: Apart from Meta and the significantly surging AMZN, the overall market closed higher.
SpaceX drops 8% after earnings: All beat expectations, including capex
Launch services revenue was $960 million, up 29% year-over-year, beating market expectations of $870 million.
Starlink business revenue was $4.29 billion, slightly above market expectations of $3.88 billion.
AI business revenue was $2.56 billion, higher than the market expectation of $2.08 billion.
AI capital expenditure Q2 CapEx reached $18.37 billion, far exceeding expectations, mainly driven by AI. It will remain at high levels for the next few quarters (targeting the advancement of 20GW-level power/cooling capacity).
Cash burn was approximately $22 billion in the first half of the year. Short-term profitability and free cash flow improvement are slow, similar to the burning cash concerns for other high CapEx AI infrastructure stocks. However, the impact of this concept won't be that large in reality; the main focus is still on tomorrow's unlock (about 911 million insider shares unlocking on August 6, which is much larger than the current float). Recently stabilized, watching support levels at 108/112/120.
AMD drops 8% after earnings: Mass production looks to next quarter
Revenue was $11.536 billion, up 50% year-over-year and 13% quarter-over-quarter, beating expectations across the board.
Data center business revenue was $6.72 billion, up 107% year-over-year and 16% quarter-over-quarter, accounting for about 58% of total revenue.
Client segment revenue was $3.06 billion, up 23% year-over-year, driven by increased Ryzen processor share and strong mobile performance.
Gaming revenue was $779 million, down 31% year-over-year, under pressure.
Q3 Guidance: Revenue approx. $13 billion ±$3 billion (midpoint exceeds consensus of approx. $12.52 billion), YoY approx. +41%, QoQ approx. +13%; Adjusted gross margin approx. 56%.
Helios has entered mass production, with limited shipments starting at the end of Q3. True volume ramp-up can only be seen in Q4 (continuing into 2027). Other aspects also saw a significant increase in CapEx, which is a factor. Overall, it's still a matter of timing. Stock price is looking between 459-500, waiting for further catalysts.
PLTR after earnings: Double consecutive gains in after-hours and opening
PLTR, an application sector we previously followed, has released its results. Besides average international commercial growth, government + US commercial growth is very strong, especially the latter, with YoY acceleration in local AI becoming a key driver.
Although it has risen so much, the upside space is relatively limited overall. Watch out for resistance levels at 163/169.
APP Earnings:Another familiar face, Applovin, reports tonight. We don't know what the performance will be, but those who have seen Apple's earnings report know that mobile gaming has been dragging things down recently. Will Applovin confirm this?
From the current position, the defense line is very weak. After app stocks have risen so much, the market has little willingness to pull it up, so expectations are low.
Gold: Dalio's warning: AI bubble has arrived, gold is the hard currency.
During the last gold bull market, Dalio contributed significantly. Now that gold has generally stabilized, it counts as an excellent defensive layout.
$SpaceX(SPCX.US) $Palantir Tech(PLTR.US) $AppLovin(APP.US) $AMD(AMD.US)
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