Key Takeaways
- Macy’s (M) crushed second-quarter estimates with Adjusted EPS of $0.63 (vs. $0.36 expected) and raised its full-year guidance, driven by a 2.7% jump in comparable sales.
- Broadcom (AVGO) revealed a massive $179.2 billion in remaining performance obligations (RPO) as of August 2, reflecting explosive demand for AI accelerators and networking chips.
- Geopolitical instability escalated as Houthi rebels seized the strategic port of Mokha in Yemen, while Iran suspended a 10% freight charge to bypass U.S. naval blockades on energy exports.
- Nasdaq (NDAQ) reportedly invested $100 million in Payward (Kraken), valuing the crypto giant at $21 billion as it integrates blockchain tech into traditional equity trading.
- China's President Xi Jinping is set to visit India on September 12-13 for the 18th BRICS Summit, marking his first visit to the country in nearly seven years.
Corporate Earnings and Market Moves
Macy’s (M) delivered a standout second quarter, reporting net sales of $4.87 billion, a 1.1% increase year-over-year. The retailer's performance was bolstered by its Bloomingdale’s nameplate, which saw double-digit growth, and its "Reimagine 200" store strategy. Following the beat, the company raised its annual adjusted EPS guidance to a range of $2.15 to $2.35.
Broadcom (AVGO) continues to be a primary beneficiary of the AI infrastructure boom. The company’s $179.2 billion RPO represents a nearly $15 billion increase in contracted revenue in just one quarter. CEO Hock Tan noted that AI semiconductor revenue is expected to accelerate to $21.7 billion in the fourth quarter, a staggering 236% increase over the previous year.
In the currency and commodities space, the USD/JPY pair extended its gains, rising 0.3% to hit a day high of 154.08. Meanwhile, LME Copper prices dropped 2% following reports of potential tariff cost concerns in the U.S., which could dampen global demand despite current supply tightness.
Geopolitical and Macroeconomic Developments
The Middle East remains a flashpoint for global trade. Yemen’s Houthi rebels have successfully seized the strategic port city of Mokha, moving closer to the Bab al-Mandeb strait. This development threatens one of the world's most critical shipping corridors. Simultaneously, Iraq's IOTC is tendering for oil supertankers for 180-day periods to navigate the Strait of Hormuz amid heightened security risks.
To counter maritime disruptions, Iran has ordered a temporary suspension of its 10% freight charge on foreign vessels carrying energy products. This move is specifically designed to incentivize shipping companies to continue transporting Iranian oil and gas despite the ongoing U.S. naval blockade.
In monetary policy, the Central Bank of the Republic of Turkey maintained its one-week repo rate at 37.00%, meeting market expectations. The bank remains in a restrictive stance to combat persistent inflation, even as domestic demand begins to show signs of cooling.
International Relations and Infrastructure
China is preparing for a significant diplomatic push, announcing it will host the APEC Summit in Shenzhen on November 17-18. This follows the news that President Xi Jinping will attend the BRICS Summit in New Delhi, a move seen as a potential step toward normalizing relations with India.
Tragedy struck the maritime sector in China as a fire at a shipyard in Qingdao claimed the lives of 20 people. The fire broke out on a foreign-flagged cargo ship, the Ocean Melody, during routine maintenance. President Xi has called for an urgent investigation and accountability for the incident.
Finally, South Africa reported surprisingly resilient manufacturing data for July. Manufacturing production rose 1.1% year-over-year, far exceeding analyst estimates of a 2.0% contraction. On a month-to-month basis, production surged 2.2%, providing a rare bright spot for the nation's industrial sector.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.