Space X surges nearly 16% as storage stocks slump; S&P 500 hits record high
U.S. stocks rose across the board on Aug. 7, as weak nonfarm payrolls data reduced expectations for a Federal Reserve rate hike. The S&P 500 closed at a record high. The Dow Jones Industrial Average ended at 54,036.93, up 0.28%. The Nasdaq Composite closed at 26,690.62, up 1.30%, while the S&P 500 finished at 7,757.64, up 0.62%. All three major U.S. indexes posted their biggest weekly gains since mid-April. The Dow rose 2.96% for the week, the Nasdaq gained 5.19%, and the S&P 500 advanced 3.57%. On the macroeconomic front, U.S. nonfarm payrolls unexpectedly declined in July. The result fell far short of the growth level expected by the market and came in below the lower end of every economist’s forecast range, marking the weakest performance of the year. Nonfarm payrolls for the previous two months were also revised sharply lower, providing further evidence that the labor market is cooling significantly. After the data were released, traders quickly reduced their bets on a Federal Reserve rate hike this year, and discussion intensified over whether the market needed to reassess the Fed’s policy path. Hawkish voices within the Federal Reserve had been growing louder. The Fed chair, who had largely avoided signaling the direction of interest rates, had left the door open to a September rate hike. A report said the chair was prepared to move ahead with a hike at the September meeting if inflation data released over the coming weeks proved strong. Interest-rate futures had previously priced in a more-than-50% chance of a 25-basis-point September hike. After the unexpectedly weak payrolls report, those expectations fell quickly and market sentiment reversed sharply. Most of the seven major technology stocks rose on Aug. 7 as reduced rate-hike expectations benefited risk assets. Tesla gained 2.83%, Nvidia rose 2.27%, Amazon advanced 0.82%, Facebook gained 0.37%, Apple rose 0.29%, and Microsoft edged up 0.03%. Google was the only decliner, slipping 0.88%. U.S. optical-communications stocks jumped. Coherent rose more than 13%, Credo gained more than 8%, Lumentum, described as an “AI picks-and-shovels” company, rose more than 6%, Corning gained more than 5%, and Marvell Technology advanced more than 3%. Storage stocks broadly declined. Seagate Technology fell more than 4%, while Western Digital, SanDisk, Kioxia ADRs and SK hynix each dropped more than 3%. Micron Technology edged lower. SpaceX surged nearly 16% on Aug. 7 and had gained 23% over the two sessions since the lockup release. Its shares closed at $133.11, giving the company a latest reported market capitalization of $1.75 trillion. According to reports, SpaceX plans to build its own power-generation facilities to support electricity needs at a large semiconductor manufacturing plant that it and Tesla are jointly developing in Texas. Earlier in the week, Riley Trettel, who is responsible for energy and data-center development at SpaceX, said at a public meeting in Grimes County, Texas: “We will power ourselves. We will build gas-fired power plants, and we will also build a very large battery array to store energy. We will start this project almost immediately. We need to begin the civil work, start building the infrastructure and foundations, and move forward right away.” The comments provided more details about a new factory project being pursued by the two companies controlled by Elon Musk. The project is called “Terafab.”
The Dow Jones Industrial Average ended at 54,036.93, up 0.28%. The Nasdaq Composite closed at 26,690.62, up 1.30%, while the S&P 500 finished at 7,757.64, up 0.62%.
All three major U.S. indexes posted their biggest weekly gains since mid-April. The Dow rose 2.96% for the week, the Nasdaq gained 5.19%, and the S&P 500 advanced 3.57%.
On the macroeconomic front, U.S. nonfarm payrolls unexpectedly declined in July. The result fell far short of the growth level expected by the market and came in below the lower end of every economist’s forecast range, marking the weakest performance of the year. Nonfarm payrolls for the previous two months were also revised sharply lower, providing further evidence that the labor market is cooling significantly.
After the data were released, traders quickly reduced their bets on a Federal Reserve rate hike this year, and discussion intensified over whether the market needed to reassess the Fed’s policy path.
Hawkish voices within the Federal Reserve had been growing louder. The Fed chair, who had largely avoided signaling the direction of interest rates, had left the door open to a September rate hike. A report said the chair was prepared to move ahead with a hike at the September meeting if inflation data released over the coming weeks proved strong. Interest-rate futures had previously priced in a more-than-50% chance of a 25-basis-point September hike. After the unexpectedly weak payrolls report, those expectations fell quickly and market sentiment reversed sharply.
Most of the seven major technology stocks rose on Aug. 7 as reduced rate-hike expectations benefited risk assets. Tesla gained 2.83%, Nvidia rose 2.27%, Amazon advanced 0.82%, Facebook gained 0.37%, Apple rose 0.29%, and Microsoft edged up 0.03%. Google was the only decliner, slipping 0.88%.
U.S. optical-communications stocks jumped. Coherent rose more than 13%, Credo gained more than 8%, Lumentum, described as an “AI picks-and-shovels” company, rose more than 6%, Corning gained more than 5%, and Marvell Technology advanced more than 3%.
Storage stocks broadly declined. Seagate Technology fell more than 4%, while Western Digital, SanDisk, Kioxia ADRs and SK hynix each dropped more than 3%. Micron Technology edged lower.
SpaceX surged nearly 16% on Aug. 7 and had gained 23% over the two sessions since the lockup release. Its shares closed at $133.11, giving the company a latest reported market capitalization of $1.75 trillion.
According to reports, SpaceX plans to build its own power-generation facilities to support electricity needs at a large semiconductor manufacturing plant that it and Tesla are jointly developing in Texas.
Earlier in the week, Riley Trettel, who is responsible for energy and data-center development at SpaceX, said at a public meeting in Grimes County, Texas: “We will power ourselves. We will build gas-fired power plants, and we will also build a very large battery array to store energy. We will start this project almost immediately. We need to begin the civil work, start building the infrastructure and foundations, and move forward right away.”
The comments provided more details about a new factory project being pursued by the two companies controlled by Elon Musk. The project is called “Terafab.”