Reddit jumps 13% on S&P 500 inclusion; Applied Materials and Broadcom slide on profit-taking and financing scrutiny. The broader market grinds higher on soft data and strong earnings.
The market delivered another constructive week, extending a recent grind higher even as it pulled back modestly from fresh records on Friday. Soft economic data reduced near-term rate-hike fears, strong earnings continued to provide fundamental support, and selective leadership within technology and energy kept the broader tape resilient.
The S&P 500 is now up roughly 4% over the past three weeks, the strongest such stretch since early May, and remains within striking distance of its record close of about 7,800.
Soft Data, Sticky Earnings, and a Patient Fed
The dominant narrative was the shift in rate expectations. July retail sales came in weaker than expected, down 0.6%, and producer prices were softer than forecast. Markets quickly priced in a lower probability of a September rate hike, now around 25% to 30%, down from near 50% earlier in the week, traders said.
This higher-for-longer but not tighter backdrop has been supportive. At the same time, the earnings season remains one of the strongest in recent years. Blended S&P 500 second-quarter earnings growth is running well above initial expectations, with the majority of companies beating both EPS and revenue estimates. AI-related capital spending remains the primary growth engine.
Geopolitical noise pushed oil prices higher and provided a bid for the energy sector. Middle East tensions and uncertainty around the Strait of Hormuz kept crude elevated, preventing the market from becoming a pure soft-landing celebration.
Reddit Joins the Index
Reddit (RDDT) surged about 13% after confirmation it will join the S&P 500, effective August 18. Index inclusion flows remain a powerful short-term catalyst, traders said. The stock carries an Alpha Score of 39 out of 100 at AlphaScala, with a Mixed label in the Communication Services sector. Its stock page tracks the move.
Chips Split: AMD Higher, AMAT and AVGO Lower
AMD and several memory and storage names, including SanDisk and Seagate, extended recent strength, showing that AI hardware leadership is broadening beyond the usual mega-cap suspects.
Applied Materials (AMAT) dropped about 5% despite solid results and an upbeat outlook. Analysts called it a classic buy the rumor, sell the news move after a massive year-to-date run. AMAT carries an Alpha Score of 62 out of 100, labeled Moderate in the Technology sector. The AMAT stock page has details.
Broadcom (AVGO) fell about 6% as analysts scrutinized potential large-scale financing needs tied to AI infrastructure. The stock has an Alpha Score of 67 out of 100, also Moderate, in the Technology sector. See the AVGO stock page.
Some hyperscalers, including Meta, Amazon, and Oracle, finished mixed to lower, reflecting selective profit-taking after strong runs. Overall market breadth improved, with the equal-weight S&P and small-caps participating more meaningfully than in some prior weeks.
What to Track This Week
This was a classic good news is good, soft data is also good week. The combination of still-robust earnings and reduced near-term Fed risk continues to support the melt-up environment, particularly for high-quality growth and AI-related names. The selective selling in certain semiconductor and mega-cap names shows that valuations are being scrutinized more carefully.
S&P 500: Watch the recent record zone around 7,800 as both resistance and potential support on any dip. Retail earnings from Home Depot and Walmart will test the consumer narrative after the soft retail sales print.
Oil and Middle East headlines remain the main exogenous risk.
Any shift in Fed speak or incoming data that re-prices the path of rates.
Key events this week include July housing starts and pending home sales data on Tuesday, Fed meeting minutes on Wednesday, the August Philly Fed Manufacturing Index on Thursday, and the August S&P Global Services and Manufacturing PMI data on Friday.
On Friday, Trump pressured Apple and other U.S. companies to stop buying memory chips from China. That could benefit Micron and other domestic DRAM and memory names as the week goes on.
The S&P 500 is now up 13.5% year to date.
Prepared with AlphaScala editorial tooling from the source reporting linked above. Indexable analysis may include a cited Alpha Score value. Publishing checks screen each story before release. Educational coverage, not personalized advice.