Macro Events & News
The markets showed early strength after the Presidents Day closure on Monday, with the S&P 500 hitting all-time highs Wednesday before sharply reversing, dropping 1.7% on Friday alone. Multiple factors likely contributed to the selloff, including the market tired and profit-taking after a strong run (exacerbated by weak Walmart guidance), concerns over persistent inflation (reinforced by FOMC meeting minutes), fears of tariffs and a potential trade war fueling inflation worries, weaker-than-expected consumer sentiment (University of Michigan report), and mounting layoffs in both the public and private sectors raising employment concerns.
The 10-Year Treasury yield ended lower at 4.43% and did not have much impact on equities. The VIX was relatively tame before spiking to 18.21 on Friday due to the growing consumer and economic concerns.
All major indexes ended lower for the week: the Dow down 2.5%, the S&P 500 down 1.6%, and the Nasdaq down 2.5%.
Watchlist News
5% ▼
Amazon Inc (NASDAQ:AMZN) trended downward throughout the week. Despite resilience in each daily sessions, the stock broke down on Friday, falling 3% and slipping below multiple technical support levels.
august bear notes
Amazon had a rough week as negative macro sentiment helped to push it past key support levels. The next significant technical support is around $200, which may be the next entry point. This decline appears to be driven more by macro weakness and fears than a change in the underlying investment thesis. Like many companies, Amazon experienced a significant sell-off on Friday. Companies with consistently strong results, such as Amazon, are likely to lead any near-term market recovery.
1% ▼
Micron (NASDAQ:MU) started the week strong, hitting $108 when markets reopened on Tuesday the same day as the announcement of the new 4600 PCIe Gen5 SSD, but subsequently faded. A sharp 4% drop on Friday, mirroring the broader market’s retreat, resulted in a near 1% weekly loss.
august bear notes
While the 4600 PCIe Gen5 SSD announcement may have contributed, Micron’s surge to $108 likely reflected growing market confidence in its positive growth levers. However, negative macro sentiment derailed this momentum. Micron’s near-term performance, along with the broader market, now hinges on one of their major customer’s upcoming earnings report next week.
4% ▼
Palo Alto Networks (NASDAQ:PANW) started the week strong, climbing to $208 before reversing course and falling 4% on Friday with the rest of the market.
august bear notes
Following a post-Presidents’ Day rally, it retreated on Thursday and Friday as consumer and economic data signaled weakening conditions. Currently trading near support, its direction, like the broader market, will likely be determined by macro factors and overall sentiment in the near term.
3% ▼
Taiwan Semiconductor (NYSE:TSM) reached a weekly high of $206 in Tuesday’s pre-market, but subsequently declined throughout the week, with no clear catalyst. Speculation regarding a potential takeover of Intel’s foundry operations continued to circulate.
august bear notes
TSMC continues to hover around the $200 support level, with NVIDIA’s earnings next week likely to be a key catalyst for its next move. This applies to the broader market as well, given AI’s dominant role in recent momentum, which largely revolves around NVIDIA. Regardless of short-term fluctuations, TSMC’s dominance in the foundry space should give long-term investors confidence.
