Market Summary — Pre market — 2026-08-20

Market Summary

U.S. equity futures are pointing to a lower open on Thursday, August 20, with S&P futures trading 34.00 points below fair value and Nasdaq futures down a steeper 173.00 points, as renewed semiconductor weakness and a fresh spike in crude oil weigh on sentiment. The pullback follows a session of broad-based strength on Wednesday, when the S&P 500 (+0.2%), Nasdaq Composite (+0.2%), and DJIA (+0.2%) all advanced in unison, even as the headline gains masked a much stronger showing beneath the surface — the S&P 500 Equal Weighted Index rallied 1.0% as rate-sensitive groups caught a bid.

Wednesday’s advance was sparked by the U.S. Treasury’s announcement that it will at least double its liquidity-support buyback operations for longer-dated securities beginning September 9, which eased pressure on elevated long-end yields and fueled gains in homebuilders (iShares U.S. Home Construction ETF +3.1%), consumer discretionary names, and health care. The health care sector (+3.5%) was the standout leader after blockbuster melanoma-vaccine trial data from Moderna sent shares up 176.97%, with Merck also surging double digits. Materials (+1.7%) benefited from higher precious metals prices. Semiconductors remained the sore spot, with the PHLX Semiconductor Index falling 2.1% and dragging on information technology (-0.7%) and industrials (-0.9%).

This morning, that chip weakness is extending into the premarket alongside a fresh leg higher in oil, which is up roughly 3.3-3.4% to near $87-88/bbl after President Trump warned of a “crushing economic operation” against Iran and reports surfaced of a tanker hijacking in the Gulf of Aden. Walmart shares are sharply lower (-6.0%) despite an EPS beat, after guiding Q3 below consensus, while Deere is modestly higher after a solid beat. Today’s data slate includes Initial Claims, Continuing Claims, and the Philadelphia Fed Survey at 8:30 ET.

Market Snapshot

Wednesday’s Close (19-Aug-26):

• DJIA: 53,463.05, +119.65 (+0.2%)
• Nasdaq Composite: 26,352.12, +41.38 (+0.2%)
• S&P 500: 7,707.98, +16.22 (+0.2%)
• S&P 500 Equal Weighted Index: +1.0%

Thursday Pre-Market Futures (as of 08:04 ET):

• S&P futures vs. fair value: -34.00
• Nasdaq futures vs. fair value: -173.00
• (Early morning read at 05:45 ET was milder: S&P -5.00, Nasdaq +42.00, before deteriorating on oil/chip headlines)

Market Breadth (WaveFinder, 20-Aug-26):

• Primary Sentiment: Very Bullish | 40 SMA Sentiment: Bearish
• Primary Bulls: 1,225 | Bears: 734
• Stocks Above 20 SMA: 27%
• Stocks Above 40 SMA: 53.48%

Year-to-Date Performance:

• Russell 2000: +22.2% YTD
• S&P Mid Cap 400: +16.3% YTD
• Nasdaq Composite: +13.3% YTD
• S&P 500: +12.6% YTD
• DJIA: +11.2% YTD

Sector Performance

Ranked by Wednesday’s session performance (Briefing.com):

1. Health Care: +3.5% — Sector leader on Moderna/Merck cancer vaccine data
2. Consumer Discretionary: +2.1% — Lifted by Target, Lowe’s, Amazon, Tesla
3. Materials: +1.7% — Higher precious metals prices boosted miners
4. S&P 500 Equal Weighted (broad market proxy): +1.0%
5. (Financials, Communication Services, Consumer Staples not individually quantified — among the seven sectors that finished positive)
6. Information Technology: -0.7% — Weighed down by semiconductor weakness
7. Industrials: -0.9% — Pressured by semiconductor-related electrical equipment names

Note: Seven of eleven S&P 500 sectors finished higher Wednesday, underscoring broad participation despite modest index-level gains.

Pre-Market Volatility Context (WaveFinder ATR):

• Energy: 3.40% (rising, P100) — highest volatility amid oil spike
• Health Care: 3.30% (flat, P100)
• Communication Services: 2.29% (rising, P100)
• Materials: 1.56% (falling, P79)
• Consumer Staples: 0.60% (flat, P47)
• Consumer Discretionary: 0.47% (falling, P42)
• Industrials: 0.27% (falling, P11)
• Real Estate: -0.23% (flat, P32)
• Financials: 0.15% (falling, P0)
• Utilities: -0.99% (flat, P16)
• Technology: -1.03% (flat, P26)

Key Earnings & Movers

• Walmart (WMT): $107.44, -6.86 (-6.0%) — Beat EPS by $0.07, revenue in-line, comps +2.6%; guided Q3 EPS below consensus while raising FY27 EPS and net sales growth guidance
• Deere (DE): $583.01, +2.38 (+0.4%) — Beat EPS by $0.41, beat revenue expectations
• Moderna (MRNA): $174.38, +111.42 (+176.97%) — Encouraging results from experimental cancer vaccine trial
• Merck (MRK): $152.22, +17.05 (+12.61%) — Positive read-through from cancer vaccine data
• Target (TGT): $159.03, +6.56 (+4.30%) — Post-earnings strength
• Lowe’s (LOW): $220.71, +5.07 (+2.35%) — Post-earnings strength
• Amazon (AMZN): $265.84, +6.39 (+2.46%) — Rebound from recent weakness
• Tesla (TSLA): $351.12, +14.25 (+4.23%) — Rebound from recent weakness
• Newmont (NEM): $125.08, +9.10 (+7.85%) — Higher precious metals prices
• TJX: Trading lower despite Q2 beat; comps +4% (Marmaxx soft at +1%); raised FY27 EPS guidance to $5.31-5.36
• Analog Devices (ADI): +1% — Record $4.02 bln quarter, revenue +39.2% yr/yr; guided Q4 above expectations

After-Hours Movers:

• Webull (BULL): +11.2% — Beat on EPS and revenue
• Nordson (NDSN): +7.8% — Beat and guided FY26 above consensus
• Coty (COTY): -8.6% — Missed EPS by $0.01 despite revenue beat
• Wolfspeed (WOLF): -9.1% — Beat EPS, missed on revenue
• Ethan Allen (ETD): +3.7% — Declared $3/share special dividend
• Bill.com (BILL): +2.0% — Beat on EPS and revenue

Stock Spotlight

Analog Devices (ADI) delivered a landmark quarter that underscores the strength of the AI infrastructure buildout even as broader chip sentiment sours. Q3 (Jul) revenue surged 39.2% yr/yr and 11% sequentially to a record $4.02 billion — ADI’s first-ever $4 billion quarter — marking its third consecutive double-digit EPS beat. The Communications segment, now 80% Data Center-driven, posted revenue growth of 84% yr/yr, with Data Center optical and power revenue each growing more than 100% yr/yr, highlighting ADI’s deepening exposure to AI infrastructure buildouts. Management specifically flagged power availability as the primary bottleneck constraining further AI progress — a dynamic that plays directly into ADI’s power-management and signal-chain product strengths.

Beyond Data Center, Industrial (49% of revenue, ADI’s largest segment) grew 53% yr/yr to $1.97 billion on broad-based strength in test/measurement and aerospace/defense, while Automotive climbed 16% yr/yr to $998 million. Guidance for Q4 (Oct) came in well above expectations, with management projecting momentum carrying into FY27 on continued AI, defense, and cyclical recovery tailwinds. The results stand in sharp contrast to the broader semiconductor tape, where the PHLX Semiconductor Index fell 2.1% Wednesday and futures point to continued weakness this morning — making ADI’s record print a notable divergence within an otherwise pressured group.

Bond Market & Treasuries

Treasuries are on track for a lower start Thursday, giving back roughly half of Wednesday’s gain in the long bond. Overnight, the 10-year note fell 8/32, pushing its yield up to 4.692%.

Overnight Yield Check (vs. Wednesday close):

• 2-yr: +1 bp to 4.19%
• 3-yr: +2 bps to 4.27%
• 5-yr: +4 bps to 4.39%
• 10-yr: +4 bps to 4.69%
• 30-yr: +5 bps to 5.24%

Wednesday’s Session: The 10-year note settled up 7/32 with its yield down 5 bps to 4.65%, while the 2-year yield finished unchanged at 4.18%. The rally was driven by the U.S. Treasury’s announcement that it will increase its maximum buybacks of longer-dated Treasuries by at least 100% from the current $2 billion, effective for the September-November buyback period — a move Deutsche Bank likened to an “Operation Twist” aimed at easing elevated inflation expectations, deficit concerns, and heavy tech-sector bond issuance pressuring the long end. The 30-year yield had notched a fresh 2026 high of 5.326% on Tuesday before this reversal.

The overnight pullback in Treasuries stems from WTI crude climbing past $88/bbl following the Gulf of Aden tanker hijacking and President Trump’s warning of “crushing” economic pressure on Iran, both of which have weighed on sentiment.

Commodities

• WTI Crude Oil: $87.24/bbl, +$2.85 (+3.4%) as of 08:04 ET — reached a four-week high overnight (as high as $88.63, +3.3%, per 07:50 ET reading) on Iran tensions and Gulf of Aden tanker hijacking; Wednesday settled +$0.80 (+0.9%) at $85.68/bbl
• Gold: $4,540.10/ozt, -0.1% overnight; Wednesday closed +$125.00 at $4,545.80/ozt
• Silver: Wednesday closed +$1.76 at $65.83/ozt
• Copper: $6.433/lb, -0.9% overnight; Wednesday closed +$0.01 at $6.50/lb
• Natural Gas: Wednesday closed +$0.03 at $2.81; weekly inventories due 10:30 ET (prior +36 bcf)

Overseas Markets

Asia-Pacific (Thursday, higher across the board):

• Nikkei 225: 66,216.79, +890.40 (+1.4%)
• Hang Seng: 25,698.49, +217.20 (+0.8-0.9%)
• Shanghai Composite: +0.2%
• India Sensex: +0.8%
• Kospi: +5.9% — sharp recovery after Wednesday’s trading-halt-driven -5.8% reversal
• ASX All Ordinaries: +0.5%

Key drivers: JGB rebound following the U.S. Treasury buyback news; Nikkei reports Japan may introduce tax incentives for retail JGB investors; SK Hynix reportedly joining Samsung in raising product prices up to 15%; PBOC held one-year/five-year LPR at 3.00%/3.50%; Bank Indonesia held rate at 5.75%.

Europe (mostly lower):

• STOXX Europe 600: -0.1%
• Germany’s DAX: -0.5%
• U.K.’s FTSE 100: -0.2%
• France’s CAC 40: -0.3%
• Italy’s FTSE MIB: +0.3% (outperformer)
• Spain’s IBEX 35: +0.1%

Key drivers: Tanker hijacking in the Gulf of Aden adding to Middle East shipping concerns; Sweden’s Riksbank held its rate at 1.75% but signaled a likely hike later this year; German bunds modestly higher despite hotter-than-expected PPI.

Economic Data

Overnight/International Releases:

• Japan July trade deficit: JPY634.5 bln (narrower than expected JPY680 bln deficit); Imports +27.8% yr/yr, Exports +23.2% yr/yr — both above expectations
• Hong Kong July CPI: +0.2% m/m, +1.7% yr/yr (as expected); Unemployment steady at 3.7%
• Australia August MI Inflation Expectations: 4.9% (up from 4.7%); July Employment Change -15,800 (expected +11,700); Unemployment Rate rose to 4.5% (expected 4.4%)
• Eurozone June Construction Output: -1.34% m/m
• Germany July PPI: +1.1% m/m (expected +0.5%), +3.0% yr/yr (expected +2.7%) — notably hotter than forecast
• U.K. August CBI Industrial Trends Orders: -25 (better than expected -40)
• Swiss July trade surplus: CHF8.73 bln (up from CHF5.049 bln)

U.S. Data Due Today (8:30 ET):

• Weekly Initial Claims (Briefing.com consensus 206,000; prior 209,000)
• Continuing Claims (prior 1.777 mln)
• August Philadelphia Fed Survey (Briefing.com consensus 25.0; prior 41.4)

Looking Ahead

Today’s Remaining Calendar:

• 8:30 ET: Weekly Initial Claims, Continuing Claims, Philadelphia Fed Survey
• 10:30 ET: Weekly natural gas inventories (prior +36 bcf)

Key Themes to Watch:

• Continued volatility in semiconductor stocks following two consecutive sessions of steep PHLX Semiconductor Index declines
• Oil price trajectory amid escalating U.S.-Iran tensions and Gulf of Aden shipping disruptions
• Treasury market reaction to the long-end buyback program details ahead of the September 9 implementation
• Follow-through on Walmart’s cautious Q3 guidance and its read-through for consumer spending
• OpenAI’s reported two-week pause in AI training amid security issues — a headline worth monitoring for AI-trade sentiment