S&P 500 -0.01% lower at 6,449.15 US yields trade higher: 10-year +1.9 bps to 4.340%Gold edges lower -0.04% to $3,333.73 an ounceDXY +0.30% to 98.13What to look out for today
Companies reporting on Tuesday, 19th August: Medtronic, The Home Depot, XPeng
Key data to move markets today
US: Building Permits, Housing Starts and a speech by Federal Reserve Vice Chair for Supervision Michelle Bowman.
Japan: Adjusted Merchandise Trade Balance, Imports, Exports, and Merchandise Trade Balance Total.
US Stock Indices
Dow Jones Industrial Average -0.08%.
Nasdaq 100 +0.01 %.
S&P 500 -0.01%, with 6 of the 11 sectors of the S&P 500 down.
US equities fluctuated in a narrow range throughout the trading session on Monday as investors adopted a cautious stance ahead of a pivotal week for economic news, with earnings updates from major retailers and a key speech from Fed Chair Jerome Powell scheduled for later this week.The Dow Jones Industrial Average and the S&P 500 ended with marginal declines of -0.08% and -0.01%, respectively, while the Nasdaq Composite edged up +0.03%.
In corporate news, Novo Nordisk announced it is reducing the price of its diabetes shot Ozempic for cash-paying patients, after the drug became a focal point in the debate over high US drug prices. Additionally, the company's blockbuster weight-loss drug, Wegovy, received US approval to treat a serious form of liver disease.
Eli Lilly & Co successfully sold $6.75 billion of debt in a seven-part offering that included a 40-year bond. The proceeds are for general corporate purposes, which may include debt repayment. The offering comes amid a limited supply of long-dated corporate bonds.
An investor group led by the owner of several boutique New York hotels agreed to acquire Soho House and take the members’ club operator private in a $2.7 billion deal, following a period of struggle for the company since its initial public offering.
Starbucks announced it will give all salaried employees in North America a 2% raise this year, a shift from its previous discretionary-based increase policy.
Air Canada withdrew its financial guidance through year-end, citing the impact of an ongoing strike by flight attendants that has forced the airline to cancel hundreds of flights.
S&P 500 Best performing sector
Consumer Discretionary +0.38%, with Royal Caribbean Group +4.09 %, Lululemon Athletica +2.60 %, and Deckers Outdoor +2.54 %.
S&P 500 Worst performing sector
Real Estate -0.95%, with SBA Communications -2.18%, Invitation Homes -1.93%, and CoStar Group -1.67%.
Mega Caps
Alphabet -0.30%, Amazon +0.20 %, Apple -0.30%, Meta Platforms -2.27%, Microsoft -0.59%, Nvidia +0.86 %, and Tesla +1.39 %.
Information Technology
Best performer: First Solar +9.69 %.
Worst performer: Intel -3.66%.
Materials and Mining
Best performer: Albemarle +1.10 %
Worst performer: Amcor -2.86%.
European Stock Indicest
CAC 40 -0.50%.
DAX -0.18%.
FTSE 100 +0.21 %.
Corporate Earnings Reports
Posted on Monday, 18th August
Palo Alto Networks quarterly revenue +12.1% to $2.563 bn vs. $2.563 bn estimate.
EPS at $0.95 vs. $0.95 estimate.
Nikesh Arora, Chairman and CEO, said, “Our strong execution in Q4 reflects a fundamental market shift in which customers understand that a fragmented defense is no defense at all against modern threats. They are partnering with us because our platforms are designed to work in concert, creating powerful operational synergies that deliver superior, near real-time outcomes and the efficiency our customers need. We exited fiscal year 2025 with an acceleration in RPO, and surpassed the $10 billion revenue run-rate milestone, positioning ourselves well for sustained growth ahead.” — see report.
Blink Charging quarterly revenue -13.8% to $28.7 bn vs. $22.2 bn estimate.
Loss Per Share at -$0.31 vs. -$0.18 estimate.
Mike Battaglia, President and CEO, said, “We made solid progress in the second quarter, achieving consolidated revenues of $28.7 million, reflecting growth of 38% sequentially as compared to the first quarter of 2025, highlighted by a 73% sequential increase in product sales and an 11% sequential increase in service revenues. Furthermore, although we incurred $16.5 million in largely one-time, non-cash charges this quarter, we reduced our ongoing annual operating expenses by approximately $8 million, reflecting our commitment to enhancing efficiencies across the business.” — see report.
Commodities
Gold spot -0.04% to $3,333.73 an ounce.
Silver spot +0.05% to $38.01 an ounce.
West Texas Intermediate +0.22% to $63.28 a barrel.
Brent crude +0.54% to $66.50 a barrel.
Gold prices remained relatively stable on Monday as investor attention was drawn to a meeting between the US President, Ukrainian, and European leaders, and the upcoming Fed's annual symposium in Jackson Hole.
Spot gold was little changed at $3,333.73 per ounce, after reaching its lowest point since 1st August earlier in the day. Concurrently, the US dollar appreciated by +0.30%, which made gold more expensive for investors holding other currencies.
A key focus for investors on Monday was the White House meeting where President Trump, Ukrainian President Volodymyr Zelenskiy, and European leaders convened. The meeting was part of a push by Washington for a rapid peace agreement to end Europe's most severe conflict in eight decades. This followed the US President's prior meeting with Russian President Vladimir Putin on Friday, during which both leaders had agreed to work towards a peace deal without first implementing a ceasefire.
Oil prices ended Monday higher. Brent crude futures rose by 36 cents, or +0.54%, to settle at $66.50 a barrel. WTI crude increased by 14 cents, or +0.22% to $63.28 a barrel.
Note: As of 5 pm EDT 18 August 2025
Currencies
EUR -0.44% to $1.1661.
GBP -0.39% to $1.3502.
Bitcoin -0.57% to $116,733.70.
Ethereum -1.69% to $4,357.07.
The US dollar traded higher on Monday as market participants turned their attention to upcoming events. The euro declined by -0.44%, closing at $1.1661, while the dollar strengthened by +0.43% against the Japanese yen to ¥147.81.
Sterling weakened -0.39% against the dollar to $1.3502. The euro also edged down -0.10% against the pound, trading at £0.8624. The release of Britain's consumer inflation data for July on Wednesday will be a key point of focus for the market.
This market activity occurs within a broader context of unusually low conviction among traders this month. This sentiment is consistent with the low realised and declining implied volatilities observed in foreign exchange markets, which have lacked a clear directional trend for the dollar for nearly two months.
Fixed Income
US 10-year Treasury +1.9 basis points to 4.340%.
German 10-year bund -2.2 basis points to 2.767%.
UK 10-year gilt +4.2 basis points to 4.742%.
US Treasury yields concluded Monday's session with a modest increase, reversing an earlier dip. Yields initially fell following the release of August data from the National Association of Home Builders, which indicated that US homebuilder sentiment had dropped to its lowest level since late 2022.
By the close of trading, the yield on the 10-year Treasury note rose by +1.9 bps to 4.340%. The two-year Treasury yield, which is particularly sensitive to interest rate expectations, rose +1.0 bps to 3.771%. The two-year yield had risen sharply last Thursday following the producer inflation (PPI) report but has since moderated on renewed expectations for a potential rate cut. The Treasury market exhibited a muted reaction to Monday's meeting between US President Donald Trump and Ukrainian President Volodymyr Zelenskiy.
On the supply side, the Treasury Department held two successful auctions. An auction for $82 billion in 13-week bills was 2.7x oversubscribed with a high yield of 4.232%. A separate auction for $73 billion in 26-week bills was 2.9x oversubscribed, clearing at a high yield of 4.081%.
Investors are primarily focused on Fed Chair Jerome Powell's scheduled appearance later this week at the Fed’s annual economic symposium in Jackson Hole, Wyoming. Market participants will be analysing his remarks for any suggestions about potential interest rate cuts next month and the future speed of monetary policy change. However, the prevailing expectation is that Fed Chair Powell will refrain from committing to a specific monetary path before reviewing the complete set of economic data for August.
Furthermore, investors will be closely monitoring a series of earnings releases from major US retailers—including Home Depot, Target, and Walmart—for insights into the durability of consumer spending.
Fed funds futures traders are now pricing in a 83.6% probability of a rate cut in September, down from 85.9% last week, according to CME Group's FedWatch Tool. Traders are currently anticipating 53.1 bps of cuts by year-end, lower than the 57.9 bps expected last week.
Across the Atlantic, eurozone government bond yields declined modestly on Monday. The yield on Germany's 10-year Bund fell by -2.2 bps to 2.767%.
Across the German yield curve, the two-year yield, particularly sensitive to interest rate expectations, decreased by -0.1 bps to 1.980%. Further out, the 30-year yield declined by -1.1 bps to 3.338%, remaining just below the 14-year high of 3.356% reached previously.
In the periphery, the yield on Italy's 10-year government bond fell -1.2 bps to 3.568%. This movement brought the spread between Italian and German 10-year yields to 80.1 bps.
These market movements occurred against a backdrop of stable monetary policy expectations. Interest rate outlooks for the ECB have remained anchored since policymakers decided to keep the deposit rate unchanged at their July meeting. Money markets are pricing in approximately 11 bps of easing by the end of the year, which implies a roughly 45% probability of another rate cut.
On the supply side, market participants are looking ahead to Germany's sale of two 30-year bonds this week. This marks an expected increase in auction volume after the previous week recorded the lowest issuance level of the year.
Note: As of 5 pm EDT 18 August 2025
Global Macro Updates
August NAHB builder confidence slips. The August NAHB Housing Market Index dropped one point to 32, contrary to expectations of a one-point increase to 34. This drop in builder confidence reflects persistent challenges within the US housing sector.
An analysis of the index's components reveals a mixed but generally cautious sentiment. The gauge for current sales conditions fell by one point to 35. However, the index measuring sales expectations for the next six months remained unchanged at 43, while the prospective buyer traffic index showed a slight improvement, rising two points to 22.
According to economists at the NAHB, housing affordability remains the primary obstacle for potential buyers, many of whom are postponing purchases in anticipation of lower mortgage rates. In addition to demand-side pressures, builders are confronting significant supply-side headwinds. These include restrictive regulatory policies concerning land development and broader challenges related to economic growth and inflation. This cautious outlook aligns with the general uncertainty and depressed sentiment prevalent in the housing market.
Recent market analyses, such as one from Redfin, indicate several shifts that could favour buyers. These include falling mortgage rates, a slowdown in home price growth to its lowest level in two years, an increase in housing inventories, and a rise in seller incentives.
Despite these developments, the market response has been tepid. For instance, while the average mortgage rate fell to 6.67% last week—its lowest point since April, according to MBA data—this failed to meaningfully stimulate buyer activity. Mortgage purchase applications saw only a marginal 1% week-over-week increase, underscoring the ongoing hesitation among prospective homebuyers.
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