Yesterday was a pretty good session, all things considered. Early strength didn’t attract buyers but held, and right now, that’s a win.

Companies that posted strong earnings and guidance got belated love; Moderna Inc (MRNA) is still riding the cancer vaccine high, and fintech is edging higher ahead of the Jackson Hole Summit.

Consumer Weakening

I’m not a huge fan of some of the decisions Dick’s Sporting Goods (DKS) has made in recent years, but they survived the purge of national sporting retailers. I didn’t get a chance to dig into the details (the company removed earnings slides from its website two years ago), but they missed it by a mile and paid a huge price.

Was it the ‘Foot Locker’ takeover (or a rotten shopping experience), or the consumer?

Shares of Dick’s were already lurching lower on increased volume, so maybe someone knew something.  The shares were hammered down by 30%. I’m not sure any company deserves that kind of haircut on earnings news.

Biggest Decliners

Dick’s dragged several retailers down in the session. This followed a weak retail sales report, slower Redbook trends, and Apple’s (AAPL) App Store quarterly sales declining for the first time in a decade. 

According to the Conference Board Consumer Survey, people expect to spend less on restaurants, streaming and internet services, beauty and health care, and we are all bracing for higher utility bills.

Oil Must Come Down

Crude oil came down in the session, and a seven–handle drop would be cheered by markets. Perhaps this happens if the latest ceasefire really works out.

Jensen Knows to Sell

Jensen Huang has been great at buying, but his job after the close is to sell. Whatever the results are, he will have to convince investors that all their investing is more than a replay of dot.com era shenanigans to inflate demand. I admire his achievement, but I am not a big fan of the man. Still, I think the stock price is extremely undervalued.

Moreover, I think the relentless campaign to derail the artificial intelligence (AI) trade is a dangerous political gambit.

The options market is pricing a 4.6% move, the lowest in almost two years.

Speaking of earnings after closing, software names were hit after posting results:

• Intuit Inc (INTU)
• NCNO
• Zoom Communications (ZM)

Active traders have been arbitraging, with buyers shifting into anti-AI niches, including software (and consulting and data-based businesses), but that is not a substitute for fundamental investing. That lesson can be driven home over the next 24 hours. Of course, that would mean good earnings could move the needle, but that hasn’t been the case.

Main Street investors have remained confident in the market, and that gives me confidence – even if Wall Street will never give so-called “dumb money” proper respect.

Today’s Session

This morning we learned personal income came in at +0.4%, double consensus and twice the pace of spending, helping lift the savings rate.

Headline PCE was slightly above consensus, but core edged down to 3.3% on a year-to-year basis.

Core PCE is the key, and it's moving in the right direction.

Meta Platforms (META) settled its case with California and other states, and the stock is climbing.

Otherwise, it's all quiet on the Western Front…for now.

We'll have more on Nvidia (NVDA) reporting after the close in the afternoon note.

Comments

I have several questions that could affect the answer dramatically. First, how much will be saved annually from the massive fraud that has been uncovered if it is eliminated? Next, instead of viewing problems as a zero sum game, how much could our tax system be improved through proper tariffs and increased corporate tax revenue from the AI boom actually begin to reduce the blance. ? Could those items dramatically start to reduce the deficits if we were to cap spending? Seems to me we are approaching this the wrong way if we truly are a country that is based on capitalism. C. Raymond Weldon on 8/26/2026 10:35:55 AM

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