1. Macro Drivers
Tariff Overhang – Trump announced new tariffs, set to take effect in October, covering drugs, heavy trucks and furniture. Healthcare and biotech names were hit hardest.
Cooling Rate-Cut Hopes – Stronger-than-expected durable goods and labor data trimmed expectations for a year-end Fed cut.
Key Data Ahead – Core PCE inflation prints later today; markets are bracing for a directional catalyst.
2. Market Performance
Indices – S&P 500 opened down about 0.5%, Nasdaq lower by 0.4%, both trading in a choppy, risk-off tone.
Sector Moves –
Healthcare/Biotech: leading laggards on tariff headlines
Tech/Semiconductors: valuation pressure rising as yields stay firm
Utilities/Energy/Infrastructure: relative resilience, attracting defensive flows
3. Stock Highlights
NVIDIA (NVDA) – Remains the bellwether for AI and semis; rich multiples make it hypersensitive to rate and sentiment swings.
Apple (AAPL) – Steady fundamentals, but difficult to decouple from broader tech weakness.
Microsoft (MSFT) – Cloud and software revenues provide some downside cushion, though valuation still leaves little room for error.
Alliant Energy (LNT) – Classic defensive play in utilities; stable demand and dividend support make it a hedge in volatile markets.
4. Strategy Takeaways
Near Term – Wait for the PCE release before committing capital. A softer read could set up a tactical bounce in tech; a hot print would argue for staying defensive.
Medium Term – The AI/tech growth story is intact, but entry points matter. Favor high-quality names with strong cash flow and pricing power.
Defensive Balance – Keep a portion of the portfolio in utilities and essential infrastructure to buffer policy or data shocks.
Risk Discipline – Stay nimble. Define stops and profit-taking levels to manage volatility driven by policy headlines and inflation surprises.
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