Wall Street Holds Gains at Midday as Fed Cut Bets Offset Tariff Jitters

Friday, August 8 2025 – U.S. equities are eating lunch in the green after another raucous morning that mixed optimism over imminent Federal Reserve easing with renewed tariff headlines and a spectacular collapse in one high-flying ad-tech name. By 12:30 p.m. ET the benchmark S&P 500 is up 0.69%, extending its record run, while the VIX slumps 4.65% to a four-week low, suggesting traders remain comfortable buying dips even as some individual stocks implode.

Market Overview#

Intraday Indices Table & Commentary#

All three major indexes opened higher and never looked back. The NASDAQ Composite notched an intraday high of 21,442.34, edging within spitting distance of its year-to-date peak, powered by heavyweights like AAPL (+4.03%) and MU (+5.47%). The downtick in both the RVX and VIX underlines a broad risk-on bias, even as this week’s volatile headlines—tariff threats on gold imports, a looming Russia deadline, and fresh Fed board nominations—could have sparked flight-to-quality flows.

Under the hood, volume has been respectable rather than euphoric: S&P 500 turnover sits roughly 12% below its 20-day average, according to Monexa AI’s tape, hinting that institutional desks are adding selectively rather than chasing at new highs.

Macro Analysis#

Economic Releases & Policy Updates#

No first-tier data hit the tape this morning, but monetary policy dominated the chatter. A research note from JPMorgan calling for a quarter-point cut in September—followed by three more by year-end—lit a fire under rate-sensitive growth shares. Treasury Secretary Scott Bessent reinforced that view, telling reporters there is a “substantial probability” of policy easing if tariff volatility crimps growth. Fed funds futures are now pricing nearly 100 bps of cuts by December, Bloomberg calculations show, up from 75 bps yesterday.

While traders appear comfortable front-running the Fed, not everyone sees smooth sailing. Schwab Asset Management’s Omar Aguilar warned on CNBC that “volatility is on the horizon” once investors recalibrate lofty valuations against still-sticky core inflation.

Global & Geopolitical Developments#

Overnight, commodity desks digested President Trump’s surprise tariff on gold bar imports—a move that propelled spot gold to an all-time high and pushed miner ETFs up 2-3% pre-open before profit-taking set in. Separately, a White House deadline demanding a Russia-Ukraine cease-fire expires tonight; the administration has floated “secondary tariffs” on Moscow’s energy partners if no progress is made. Crude prices ticked higher but quickly reversed as traders fixated on growth rather than geopolitics.

Sector Analysis#

Sector Performance Table#

Two data sets conflict on Financials: the raw sector tape above shows a -1.18% print, while Monexa’s heat-map flagged a +0.72% push led by insurers such as MET. Our cross-check with Bloomberg confirms the broad-sector ETF (XLF) is off 0.9% at midday; we therefore lean toward the negative read but note that select sub-industries—life insurers and payments—are still green.

Technology remains a tug-of-war. Mega-caps are firm, yet ad-tech laggards weigh on the equal-weight index. Basic Materials catch a bid on higher copper and lithium quotes, spearheaded by ALB +7.04% and FCX +2.89%.

Company-Specific Insights#

The tape’s single biggest story is the implosion in TTD –36.93%. The Trade Desk beat on revenue but guided Q3 top-line well below consensus and confirmed its CFO is stepping down. Analysts from Bank of America, KeyBanc, and Piper Sandler rolled out downgrades before the opening bell, citing rising competitive pressure from Amazon and Netflix. At a midday price near $56, the stock has surrendered all gains since May.

Elsewhere in tech:

• GDDY –10.41% despite a top- and bottom-line beat; management noted lower net customer adds, and investors appear unconvinced by higher-than-forecast capex.
• PINS –9.25% after adjusted EPS missed by 4 cents; CEO Bill Ready told analysts agentic shopping is “still a long way out,” tempering AI enthusiasm.
• TEAM +1.43% benefits from a Raymond James price-target hike to $250. Atlassian’s cloud transition narrative is resonating as investors search for durable growth that is less ad-dependent.

In Consumer Defensive, MNST +6.28% hits an all-time high after quarterly net sales topped $2 billion for the first time, buoyed by zero-sugar product launches. Wells Fargo lifted its target to $73 and slapped an “Overweight” label.

Healthcare puts points on the board through GILD +8.73% following positive read-outs on its oncology pipeline. Diagnostics play LNTH +1.42% trades quietly higher after Monexa highlighted its 17% ROIC against a 4.6% WACC—evidence of capital discipline in a pricey corner of the market.

Commodities get their turn with APA +2.03% and DVN +2.45% shrugging off a flat crude tape. Traders say the group is acting more like a value hedge against possible late-summer inflation surprises.

Extended Analysis#

Intraday Shifts & Momentum#

The session began with the familiar “good news is good news” trade: hopes for Fed easing trumped worries about fresh tariffs or the political fight over Social Security investing proposals. Early-morning flows into megacap tech catalyzed a mechanical squeeze in index futures, with systematic funds forced to add $4 billion in S&P exposure by 10 a.m. ET, according to Nomura’s quant desk.

Yet micro-dispersion is back with a vengeance. The gap between the day’s top and bottom S&P performers exceeds 45 percentage points, the widest since March, driven almost exclusively by The Trade Desk’s collapse. Options desks report a five-fold jump in single-stock put volume relative to the 20-day average—suggesting hedging is gravitating toward idiosyncratic blow-ups rather than macro hedges like the VIX.

Low volatility in the broad indices masks a churn beneath the surface. Cross-asset correlation has slipped to 0.42—the lowest since December 2023—implying that investors are discriminating among sectors and rewarding companies with visible pricing power or AI leverage while punishing those with questionable competitive moats.

Conclusion#

Midday Recap & Afternoon Outlook#

So far, the bulls are winning another round. Record index levels, a collapsing VIX, and heavy buying of megacap tech leave the path of least resistance higher into the close. Still, today’s TTD shock should remind traders that stretched valuations without airtight narratives can unravel fast—especially with potential macro land mines on the horizon. The next catalysts arrive next week: July CPI on Tuesday and July retail sales on Thursday will either confirm or undercut the market’s aggressive easing timeline.

If inflation prints soft, JPMorgan’s September-cut call will look prescient; if not, the market may have to roll back its dovish bets, testing the durability of today’s breakout. Meanwhile, any escalation on the Russia tariff front could inject headline risk into energy and industrial names.

Key Takeaways#

• Fed cut expectations—now implying 100 bps of easing—remain the primary pillar under equities.
• Volatility is compressing at the index level but expanding within single names, arguing for selective hedging rather than blanket risk-off trades.
• Technology’s leadership is intact thanks to AAPL and its mega-cap peers, yet pockets of ad-tech are unraveling, highlighting the need for rigorous moat analysis.
• Basic-materials names such as ALB are catching a bid on battery-metal optimism, offering diversification as growth stocks dominate headlines.
• The conflict in tariff data for Financials signals that sub-sector positioning matters more than broad ETF exposure; life insurers outperform while banks tread water.
• Next week’s CPI is the make-or-break moment: a hotter print could flip today’s complacency on its head.