US Weekly Recap: Dow (0.19%), S&P (0.10%), Nasdaq (0.19%), Russell 2000 +0.19%
Friday, August 29, 2025 (GMT)

Overview:

US equities were mostly lower this week. Comes after stocks ended last week mostly stronger. Small-caps again outperformed with Russell 2000 edging out a slight gain. Underperformers included utilities, food, beverages, HPCs, homebuilders, exchanges, medical devices, and hotels. Big tech was mixed. Outperformers included energy sector, banks, credit cards, casinos, airlines, precious metals miners, cruiselines, and China tech (BABA +9.8%). Treasuries were mixed with yield curve steepening. Dollar Index little-changed. Gold ended the week up 2.8%, setting fresh record highs. WTI crude was up 0.5%

What happened?:

Market saw a slight pullback this week as several headwinds came into focus: mixed takeaways from NVDA -2.2% earnings, looming 2H tariff pressures on corporate profits, concerns over Fed independence, and ongoing cooling labor market worries. Offsetting these pressures were encouraging signals of resilient consumer spending, constructive AI secular growth themes highlighted in NVDA’s results, and supportive trade headlines.

NVDA’s Q2 earnings were the week’s highlight, with results beating expectations and Q3 guidance above, though not by as much as hoped. Datacenter revenue slightly missed with a small sequential dip in compute, but still grew 56% y/y. Importantly, neither H20 China nor Q3 guidance included in those figures. Management also flagged strong Blackwell momentum, keeping overall AI demand takeaways upbeat.

There were a flurry of retail earnings this week with all eyes on consumer spending health signs. Tariff headwinds are real but remained mostly manageable; companies noted discretionary spending remains strong among premium shoppers, while middle- and lower-income segments faced ongoing pressure. ANF -5.0% beat on Hollister growth but flagged tariffs, while A&F lagged. KSS +8.4% beat and raised despite negative comps. URBN -12.8% posted strong topline with positive comps across brands. DKS -6.5% beat on all metrics and raised FY25 guidance. PVH +5.6% beat, with tariffs starting to show but offset by cost controls. DG -3.2% beat and raised, though comps are slowing and tariffs/inflation remain a concern for core lower-income customers. GAP +2.7% beat but lowered FY EPS outlook due to tariff headwinds.

Fed independence came under scrutiny after Trump fired Governor Cook over alleged mortgage fraud. Cook plans to challenge the firing in court, while the Fed emphasized its independence and adherence to federal law, which allows removal of governors only for cause. White House is reportedly considering shifting CEA Chair Miran’s nomination to Cook’s seat and nominating former World Bank head Malpass to the open Kugler seat. Meanwhile, Fed Governor Waller reiterated a transitory view on tariff-driven inflation and supported a 25 bp rate cut in September.

Trade headlines took a backseat this week, though several developments stood out. Brussels signaled potential US-EU progress by offering to lift tariffs on industrial goods and select seafood and agricultural products. Mexico indicated it would raise tariffs on select Chinese imports in response to US pressure. Meanwhile, Trump announced a furniture investigation, 50% punitive tariffs on India went into effect, and Bessent previewed over $500B in potential annual tariff revenue.

Regarding macro data this week, July core and headline PCE were in-line, while personal spending also as expected though personal income was a bit soft. Jobless claims ticked lower. Q2 GDP was revised higher in second read with personal consumption revised higher, as expected. July prelim durable goods orders declined, though still better than expected. July new home sales were in-line, slightly down from June, while July pending home sales posted surprise decline m/m.

Earnings/Corporate highlights:

Notable earnings takeaways beyond the above mentioned included: CAT -3.8% hit by disclosure of higher tariff impact. CRWD +0.1% beat and raised but implied 2H guide softer. SNOW +21.2% up big with takeaways highlighting strength in core warehouse business. HPQ +2.9% beat with PC share gains a tailwind. DELL -6.6% takeaways focused on AI server strength that also weighed on GMs. NTAP +2.1% hit by softer US public sector performance and product GM miss. BURL +3.5% margins were better. FIVE +2.3% boosted by big Q2 comp beat. WSM -7.5% beat though Pottery Barn a weaker spot. MDB +44.0% beat and raised with Atlas acceleration, US enterprise strength, margin expansion. OKTA +0.1% beat and raised. SJM –2.4% sales and EPS a bit light though raised some aspects of FY guidance. DCI +5.2%beat and guided ahead.

Beyond earnings, BABA +9.8% reportedly developed new AI chip to fill NVDA -2.2% void. T to acquire spectrum from SATS +108.6% for $23B in cash. LLY +2.9% anti-obesity pill trial results met weight loss targets. UNH +0.8% DoJ probe broader than just Medicare. CSX +6.0%hit by news that Buffett’s BRK.B +2.8% not interested in an acquisition. KDP -17.2% weaker on news that it will buy JDE Peet’s for $18B. KO -1.6% reportedly exploring options for the UK coffee chain Costa. SPOT -1.6% executive signaled to FT further price increases in the pipeline. CBRL +9.9% will go back to old logo. XOM +2.7% reportedly held talks With Rosneft over Russia re-entry.

Coming next week:

Notable macro events: Tuesday: Aug ISM Manufacturing, Jul Construction Spending; Wednesday: July Factory Orders, Fed Beige Book; Thursday: Jobless Claims, Q2 Productivity and Unit Labor Costs, Aug ISM Services, Jul Trade Balance; Friday: Aug Nonfarm Payrolls.

Notable earnings: Tuesday AM: ASO, SIG; Tuesday PM: ZS; Wednesday AM: CPB, DLTR, M; Wednesday PM: AEO, AI, PLAY, GTLB, HPE, CRM; Thursday AM: SAIC; Thursday PM: AVGO, LULU: Friday AM: KR

S&P 500 Sector Performance:

Outperformers: Energy +2.47%, Financials +0.74%, Communication Svcs. +0.70%, Materials (0.00%), Tech (0.07%)

Underperformers: Utilities (2.10%), Consumer Spls. (1.69%), Industrials (0.80%), Healthcare (0.62%), Consumer Disc. (0.53%), Real Estate (0.13%)

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