The S&P 500 and Nasdaq pulled back to test very short term support on Friday, leaving both narrowly lower for the week. But the very tight closes over the past few weeks left both indexes in three-weeks tight patterns, which could be a bullish cue as the stock market heads into September. Earnings season is slowing, but not nearly dead yet. And the holiday shortened week ahead is primed to be jam packed.
Dow Jones cloud giant Salesforce.com and chip megalith Broadcom headline the weeks earnings calendar. Lululemon Athletica leads a pack of reports from retailers, many of which spiked in the past week on earnings news. Zscaler, Argan and China EV maker Nio are also due to report.
Maybe the stock market's most prevalent news story, however, will end up being Friday's payrolls report. The first such release since President Donald Trump's firing of Erika McEntarfer, the commissioner of the Bureau of Labor Statistics, after last month's sharp downward revisions to July jobs data. This months numbers will be very closely scrutinized.
Stocks To Watch: Put A Strong Rally To Use
The S&P 500 is at record highs. The Nasdaq is just below all-time levels in a two-week pause. Not surprisingly, a growing number of leading stocks are setting up bases, handles and pullbacks, with some flashing buy signals. Netflix, Boeing, Micron, Cadence Design Systems and MercadoLibre are stocks to watch. Netflix is on the cusp of early entries. Boeing, Micron and Cadence Design are already actionable. Boeing is the Dow's second fastest moving stock this year, trailing only Nvidia. Micron and Cadence are AI-related names. MercadoLibre has a new consolidation, actionable from Thursday's rebound off its 50-day line, clearing short-term highs.
Two AI Plays Lead Five Stocks Near Buy Points
Economic Calendar: A September Rate Cut, Then ...
Next Friday brings a huge jobs report, but even a strong report likely won't derail a Fed rate cut on Sept. 17. After noting that rising labor market risks "may warrant" a rate cut, one report won't change Fed Chairman Jerome Powell's mind. Yet the Fed's rate-cut outlook beyond September could shift substantially. The unemployment rate is the key number, marking the balance between labor supply and demand. If the jobless rate ticks up to 4.3%, from 4.2%, as economists expect, markets may start pricing-in rate cuts of 75 basis points in 2025, not just 50. The Institute for Supply Management's manufacturing and services activity gauges, out Tuesday and Thursday, will also will be in focus.
PCE Inflation Data Passes First Test Of Fed Rate-Cut Shift (Live Coverage)
Blue Chip Notebook: Top Players Revise AI Strategy
Dow industrials stock Salesforce reports fiscal Q2 2026 earnings Tuesday. Analysts project a 9% EPS gain, with revenue also up 9%. Current remaining performance obligations, a key metric, are expected to grow 10%. Investors will look for an update on customer demand for "Agentforce" products, and on the planned strategic AI acquisition of Informatica (INFA). Salesforce and other software makers have shifted away from generative AI "copilots" to goal-driven AI "agents." One worry: AI productivity could lead to job cuts, a potential negative for software firms with per-seat business models. CRM shares have staged a three-week rally, deep in a consolidation.
Semiconductors: Broadcom Faces Strong Views
Broadcom reports fiscal Q3 results Thursday. The fabless chipmaker and infrastructure software provider's earnings are seen rising 34% on a 21% sales gain. Investors will focus on exposure to AI data centers, and custom AI accelerators and networking chips. Alphabet and Meta Platforms are customers. Broadcom shares are up 28% year to date.
Buyers Push Broadcom Stock Higher Ahead Of Quarterly Results, Along With This Fast-Growing AI Name
Cybersecurity: The Cyber Arms Race Quickens
Cybersecurity firm Zscaler reports fiscal fourth quarter earnings Tuesday. Fiscal 2026 outlook will be key. For Q4, analysts predict a 9% drop in adjusted EPS, with revenue rising 19%. Earnings from cybersecurity firms have been mixed for the June-July quarters. Zscaler provides cloud-based cybersecurity services via 150 data centers worldwide. It's a leader in Secure Access Service Edge and Zero Trust identity services. Palo Alto's proposed acquisition of CyberArk and Alphabet's purchase of Wiz could pressure Zscaler. But the company recently agreed to buy Red Canary, a provider of managed threat detection and response services.
Stock Market Perspective: Avoiding Kennedy's Bear
Some investors worry, says CFRA Chief Investment Strategist Sam Stovall, that White House efforts to dislodge Federal Reserve personnel could trigger a repeat of the 1961-62 bear market. That crash followed President John F. Kennedy's move to ease inflation by blocking steel industry price increases. The S&P 500 fell 28% from Dec. 12, 1961, to June 26, 1962. A bull market revived in December 1962, after the Cuban missile crisis. Stovall discounts the possibility of a bear market. Instead, he sees Wall Street focusing "on the bottom line, encouraged by forecasts for rising earnings growth." In the longer term, a spike in bond yields could result from an overly stimulative Fed.
Retail Earnings: Analysts Set A Low Q2 Bar
Earnings reports stirred brisk trade among retail stocks over the past week. The coming week may set up another round. Lululemon Athletica, Signet Jewelers, Dollar Tree, American Eagle, Shoe Carnival and GII all report. Signet has the best-looking chart, but expectations are low across the group.
Stock Market Earnings Briefs
Nio, the China-based EV maker, reports second-quarter results with analysts expecting a loss of 31 cents per share, essentially flat vs. a year ago. Sales are seen increasing 11% to $2.74 billion, according to FactSet. Nio shares soared more than 30% in August and are now up around 80% since the end of June.
Hewlett Packard Enterprise reports fiscal Q3 earnings after Tuesday's close. Analysts project adjusted EPS of 42 cents, down 17% from a year earlier, with revenue rising8% to $8.348 billion. The Department of Justice in June agreed to a settlement allowing HPE's acquisition of Juniper Networks to go forward. HPE's growth in computer servers designed for artificial intelligence workloads in data centers will be key in the fiscal Q3 report.
Credo Technology will release its fiscal first-quarter results late Wednesday. Analysts expect the maker of high-speed connectivity systems for data centers to earn an adjusted 35 cents a share, up 775% year over year, on sales of $190.6 million, up 219%, in the quarter ended Aug. 2.
Rev Group reports fiscal 2025 third-quarter earnings before the stock market opens Wednesday. Analysts consensus pegs quarterly EPS increasing 31% with revenue growing 6.4%, according to FactSet. Shares of the maker of ambulances, firetrucks and recreational vehicles have notched a string of monthly advances, rallying 77% higher since the end of February to all-time highs of 54.65 on Wednesday.
Argan announces fiscal 2026 second-quarter financials late Thursday, with expectations of 25% profit growth and sales increasing 7.4%, FactSet reports. The building and heavy construction play declined around 5% in August but found support at the 50-day line as it has declined 8% since breaking out above a traditional buy point on July 31.
