Closing Recap

U.S. stocks finished mixed after a volatile session, with the Nasdaq leading decliners for a second day on persistent tech weakness, while the Dow and S&P 500 recovered from sharp morning lows; gold and oil rallied, the dollar was mixed, and Treasury yields eased ahead of the Jackson Hole symposium. 

Key Takeaways 

• Tech Leads Market Lower Again: The Nasdaq fell for the second straight day (-0.67%), posting its first 5-day losing streak of 2025, as profit-taking in the AI and mega-cap tech space continued. 
• Stocks Rebound from Lows: Major indices clawed back from significant morning losses (Nasdaq was down -1.8%), demonstrating some underlying buying interest. Rotation into Defensives: The market saw a clear rotation out of growth and into more defensive areas like Utilities, Real Estate, and some staples. 
• AI Bubble Concerns Mount: A new MIT study showing 95% of companies get zero ROI from GenAI, combined with recent comments from OpenAI’s Sam Altman, fueled concerns about an AI bubble and added pressure on tech stocks. 
• Focus on Powell at Jackson Hole: Markets are in a holding pattern, showing increased caution and consolidating recent gains ahead of Fed Chair Powell’s key speech on Friday. 
• FOMC Minutes Showed Division: Minutes from the July Fed meeting, released today, confirmed that only two governors (Waller & Bowman) supported an immediate rate cut at that time. 
• Gold & Oil Rally: Gold prices climbed on safe-haven demand and Fed uncertainty. Oil prices also rebounded from recent losses. 
• Treasury Yields Stable: Treasury yields were little changed after a solid 20-year bond auction. 

Market Overview

U.S. equity markets experienced another day of consolidation and rotation, with the Nasdaq Composite leading the market lower for the second consecutive session. Selling pressure was once again concentrated in the large-cap technology and momentum stocks that have driven the market’s powerful rally since April. The Nasdaq fell as much as 1.8% in the morning, hitting two-week intraday lows and marking its first five-day losing streak of the year. However, a familiar pattern of dip-buying emerged in the afternoon, allowing major averages to recover significantly from their worst levels of the day. 

Index	Up/Down	% Change	Last
DJ Industrials	16.04	0.0004	44938
S&P 500	-15.58	-0.0024	6395
Nasdaq	-142.1	-0.0067	21172
Russell 2000	-7.23	-0.0032	2269

The recent weakness in the tech sector appears to be driven by a confluence of factors. Yesterday’s Bloomberg report on traders buying “disaster” puts was compounded today by a new, widely circulated MIT study which found that 95% of organizations are getting zero return on their generative AI investments. This, along with recent comments from OpenAI CEO Sam Altman about a potential AI bubble, has triggered a bout of profit-taking and raised questions about the sector’s lofty valuations. 

While tech faltered, there was a clear rotation into more defensive areas of the market, including Utilities and Real Estate. Investors are adopting a more cautious posture ahead of the Federal Reserve’s annual Jackson Hole symposium, which begins tomorrow, with all eyes on Chairman Jerome Powell’s keynote speech on Friday. The release of the July FOMC meeting minutes today revealed that “almost all participants” favored holding rates steady at that meeting, with only two governors dissenting for a cut, reinforcing the “wait and see” approach that has frustrated some market participants.

Economic Calendar

The primary event yesterday was the release of the July FOMC meeting minutes, which provided more detail on the internal debate at the Fed. 

• FOMC Meeting Minutes (July 29-30 Meeting): Showed “almost all participants” favored holding rates steady at the meeting. Two governors (Waller & Bowman) dissented, favoring a cut. Participants noted increased risks of a recession and the potential for “difficult tradeoffs” between rising inflation and unemployment. 

Commodities, Currencies, and Treasuries 

Gold prices rallied, with December futures gaining $29.80 (+0.89%) to settle at $3,388.50 per ounce. The metal benefited from its safe-haven appeal amid the tech stock sell-off and ongoing policy uncertainty. Crude oil prices also rebounded from recent losses, with WTI gaining $0.94 (+1.52%) to settle at $62.71/bbl, perhaps finding some technical support after a multi-day slide. 

Asset	Up/Down	Unit / % Change	Last
WTI Crude	0.94	USD/bbl	62.71
Brent	1.05	USD/bbl	66.84
Gold	29.8	USD/oz	3388.5
EUR/USD	0.0014	USD	1.166
USD/JPY	-0.57	JPY	147.09
10-Year Note	-0.013	%	0.04289

Natural gas prices continued their decline, hitting fresh nine-month lows. Treasury yields were little changed across the curve, with the 10-year yield easing about 1 basis point to 4.289%. A solid 20-year Treasury bond auction showed good demand, helping to keep yields in check as investors await guidance from Jackson Hole. The U.S. dollar was mixed.

Looking Ahead 

The market will be keenly focused on the start of the Jackson Hole symposium tomorrow, with the main event being Fed Chair Powell’s speech on Friday morning. His commentary will be critical for shaping expectations for monetary policy for the remainder of the year. In the meantime, weekly jobless claims will provide a fresh read on the labor market. The ongoing weakness and profit-taking in the technology sector will be a key theme to watch to see if it broadens into a more significant market pullback.