Market Overview
The S&P 500 and Nasdaq ended lower as investors continued to rotate out of tech and chipmakers, with Federal Reserve Chair Kevin Warsh stating that inflation risks have come down [1]. This rotation was evident in the decline of semiconductor stocks, including Nvidia and Broadcom, which finished lower by roughly 2% and 1%, respectively [3].
Company News
Meta Platforms, Inc. admitted to having excess compute capacity, which could potentially slow down AI capex [2]. However, the company's plan to launch a cloud business may ease the biggest overhang on the stock [4]. Meanwhile, Microsoft Corporation's launch of Copilot Cowork has reaffirmed the bullish outlook on the company [11].
Sector Trends
The tech sector has been experiencing a cooldown, with chip stocks taking a breather after an exceptionally strong first half of the year [3]. However, some companies, such as Alphabet, are expected to beat estimates again in their next earnings report [9]. Additionally, the collaboration between YPF Sociedad Anónima and Tesla on energy storage infrastructure and fast-charging networks could be a positive development for the energy sector [8].