The S&P 500 posted a record close Friday after its best week since April. Then Monday arrived and the market barely moved. The S&P slipped 0.06% to 7,753. The Dow fell 61 points to 53,976. The Nasdaq dipped 0.32% to 26,605. Intel fell 4% after announcing a $15 billion common stock offering — diluting shareholders to fund AI infrastructure. Nvidia dropped 2.9%. Apple fell 1.5%. Iran said it would demand withdrawal of U.S. forces and payment of reparations before reopening the Strait of Hormuz — conditions Washington has not shown any willingness to meet. Oil rose. The deal that powered last week's 2,500-point Dow rally just got harder. And the number that determines what happens next — July CPI — lands on Wednesday. The market is frozen because it's waiting for the verdict.
Near-flat session to start the week. The S&P slipped 0.06% to close at 7,753.11 — just 5 points off Friday's record. The Dow fell 60.95 points to 53,975.98. The Nasdaq dipped 0.32% to 26,605.36. Declining issues outnumbered advancers 1.5-to-1 on the NYSE and 1.26-to-1 on the Nasdaq. Industrials and energy led modestly on rising oil. Tech lagged on Intel's dilution and selling in AI infrastructure names. The overall tape was the quietest of the month.
| The Numbers I Circled | At the close, August 10 · Day change |
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| S&P 500 | 7,753.11 | −0.06% |
| Intel | $15B offering | −4.0% |
| Sept Hike Odds | 44% | from 67% |
| S&P 500 Sectors | Day change |
|
| Industrials | | +0.8% |
| Energy | | +0.7% |
| Comm. Services | | +0.7% |
| Materials | | +0.3% |
| Consumer Disc. | | +0.2% |
| Utilities | | 0.0% |
| Financials | | 0.0% |
| Info. Technology | | −0.1% |
| Health Care | | −0.1% |
| Real Estate | | −0.1% |
| Consumer Staples | | −0.3% |
| | Notable Gainers | Day change |
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Intel was the day's headline. The chipmaker announced it would offer $15 billion in common stock to fund AI infrastructure — a massive dilution that sent the stock down 4%. Intel framed it as a growth investment: "customers continue to signal a strong and sustainable demand environment," the filing said. The market heard "15 billion more shares outstanding." Nvidia fell 2.9% — sympathy selling across the chip complex. Apple dropped 1.5%, continuing its slide since the earnings miss. The AI infrastructure trade that surged last week — Coherent, Corning, Lumentum — reversed hard. Coherent fell 12%. The Data Center ETF lost 1%.
The Iran story shifted tone over the weekend. The Wall Street Journal reported that Tehran wants U.S. forces withdrawn from the region and reparations paid before the Strait of Hormuz reopens. Those are conditions the administration has shown no interest in accepting. Iran confirmed it's close to a separate agreement with Oman on shipping lanes, but the broader deal the market priced last week — Bessent's "today or tomorrow" — now looks much further away. Oil rose on the uncertainty.
JPMorgan raised its year-end S&P 500 target to 8,000 from 7,800, arguing that AI investment now accounts for more than half of the S&P 500's roughly $1.5 trillion in capex this year and that the earnings case is getting stronger. FedWatch prices a 44% chance of a September hike, down from 67% a week ago, after the jobs miss. Deutsche Bank said the weaker jobs data "reduced the urgency for further Fed tightening in the near term." Applied Materials, Cisco, and CoreWeave report later this week.
What The Market Is Pricing In
When a market stops moving after a big rally — when a 7,750-point S&P produces a 0.06% day — it's not because nothing is happening. It's because the next piece of evidence hasn't arrived yet. The S&P gained 3.6% last week in its best week since April, hit a record on Friday, and then sat flat on Monday. The rally was built on two pillars: the Hormuz deal hopes that sent oil down 7% for the week, and the jobs miss that pushed the Fed hike from September to December. Both of those pillars are now waiting for confirmation or denial.
The Hormuz pillar got weaker over the weekend. Iran's demand for U.S. withdrawal and reparations is a negotiating position, not a walk-away — but it tells you the deal isn't close. Every day without a deal, oil drifts higher and the inflation risk rebuilds. The Fed pillar gets tested Wednesday when July CPI lands. The number will capture the weeks when oil was between $90 and $100. If CPI comes in above 4%, the three hawks get their ammunition back and the September hike is alive regardless of the jobs miss. If it comes in below 3.8% — because the June oil collapse still dominates the month's average — the rally holds and the market has room to run to JPMorgan's 8,000 target.
The S&P sat 5 points off a record and the market produced the quietest day of the month, and the reason is simple: everyone is waiting for Wednesday's CPI to tell them whether last week's rally was the start of a new leg or the top of a narrative-driven bounce that assumed the Hormuz deal and the jobs miss would both stay bullish — and one of those assumptions already cracked over the weekend. The monthly jobs average has fallen to 34,000 over the last year — the weakest run since the pandemic recovery. Iran wants conditions the U.S. won't accept. Oil is ticking up. And $125 billion in Treasury debt goes on the block this week. The market needs Wednesday's number to decide whether to press higher or pull back. Until then, it's frozen.
In August 2015, the S&P rallied to a record on July 20 and then went dead flat for three weeks — the quietest stretch of the year. Then on August 11, China devalued the yuan and the S&P fell 10% in six sessions. Flat markets after records aren't unusual. They're the calm before the catalyst arrives. The question is never whether a catalyst is coming — it always is. The question is which direction it pushes. In 2015 it was down. This week CPI decides.
Three things I'm watching this week:
01 — July CPI Wednesday August 12
The most important print of the summer. The July reading will capture three to four weeks of gasoline at $4 or higher, reflecting the oil surge from $76 to $100 that happened between early and late July. If headline CPI comes in above 4%, the inflation-is-back narrative returns, the September hike gets repriced, and the market gives back last week's gains. If it comes in below 3.8% — because the early-July oil collapse from $95 to $76 under the ceasefire still dominates the month's average — the "inflation peaked" story survives and the rally has legs into September. This is the number.
02 — Iran demands: how does the administration respond?
Withdrawal of U.S. forces and reparations. Those are Iran's opening demands per the Wall Street Journal. If the U.S. rejects them outright, the deal timeline extends weeks and oil goes back to $90. If the U.S. treats them as an opening position and counters, the Oman shipping-lane framework stays alive and oil holds near $80. Watch for Bessent, Sullivan, or Trump responding to Iran's conditions by Tuesday night. The tone of the response determines whether oil stays at $83 or tests $90 again.
03 — Applied Materials + Cisco earnings Thursday/Friday
The last two major AI-infrastructure reports of the season. Applied Materials tells you whether the semiconductor equipment cycle is holding up — the machines that build the chips that power the data centers. Cisco tells you whether enterprise networking demand is growing or slowing. Both are downstream from the Nvidia-Microsoft-Amazon spending cycle. Strong results confirm the AI build is still accelerating. Weak results say the spending cycle peaked in Q2 and the multiplier effect that powered Caterpillar's record quarter is fading.
The S&P posted a record and the market went quiet. CPI Wednesday decides whether the rally continues or reverses. Iran's demands decide whether oil stays at $83 or goes back to $90. And the last AI-infrastructure earnings of the season decide whether the spending cycle that carried the market to all-time highs is still accelerating. Three answers, one week. The market is waiting. So am I.
That's it for today. See you tomorrow after the close.
— Tom Hartley
Today In Perspective · Published daily, Monday–Friday, after the close
This newsletter is for informational purposes only and does not constitute investment advice. The author is not a registered investment advisor. Past performance does not guarantee future results. Consult a qualified financial professional before making investment decisions.
