• Stocks: Strong earnings from several tech stocks buoyed indexes higher (more on that later). But while tech ended the day in the green, all 10 other sectors in the S&P 500 fell lower.
• Commodities: Wheat prices hit a three-year high on fears that fighting between Ukraine and Russia is set to escalate and disrupt exports from the Black Sea.
• Bonds: All eyes now turn to Jackson Hole, Wyoming, for Kevin Warsh’s first speech as Fed chair. Earlier today, his colleague and Cleveland Federal Reserve President Beth Hammack made waves when she said, “Now is the time to act,” when it comes to raising interest rates.

Earnings

Morning Brew Inc, Photos: Getty Images

Big Tech’s biggest juggernaut has once again proven the haters wrong.

Yesterday afternoon, three tech heavyweights—Nvidia, Salesforce, and CrowdStrike—told investors exactly what they were hoping to hear, and proved some bearish fears unfounded.

Shares of Nvidia soared 8.74% today on the news that it expects 70% sales growth in its next fiscal year, handily beating Wall Street forecasts of 45%. As for last quarter, revenue came in at $96.2 billion, more than double the same quarter last year.

Since investors see Nvidia as a bellwether for the rest of the AI trade, how the company performs during earnings influences whether people see the circular web of AI financing as a dangerous cycle—or a wise series of bets financing a transformative technology.

“Management delivered a compelling vision of how strategic investments help NVDA secure its dominance in this once-in-a-generation AI buildout,” explained Bank of America research analyst Vivek Arya, reiterating his Buy rating and $350 price target—53.5% higher than shares trade today.

Software flips the script

The king of chips wasn’t the only old dog showing off its new tricks. Software incumbents, which were declared all but dead after it seemed like AI would tear through the sector like wildfire, are having a kind of renaissance this earnings season.

You may not know exactly what the company does, but you know that Salesforce is as synonymous with software as it gets. The firm, which owns business messaging system Slack and data platform Tableau, delivered an A+ quarter yesterday, and issued better-than-expected forward-looking guidance. The company specifically touted a $2.6 billion gain on strategic investments, thanks to its stake in Anthropic. Shares jumped 22.58% today.

“This SaaSpocalypse narrative has been such nonsense,” Marc Benioff told CNBC Wednesday morning. He argued that instead of erasing the need for software companies like Salesforce, AI actually makes them more necessary.

And AI is boosting another corner of software: cybersecurity. CrowdStrike popped 20.5% today after it, too, beat the Street’s expectations and raised its fiscal Q2 forecast.

Unlike other companies that are getting an efficiency boost from AI, cybersecurity is getting a helping hand from the technology, in a perhaps counterintuitive way: As cyberattacks become better and more damaging, demand for CrowdStrike’s products is higher than ever.

“We are in an arms race,” CrowdStrike CEO George Kurtz said during a call with analysts. “AI is driving a clear divide between the cybersecurity companies that solve problems and those that compound problems.”

AI may not wipe out entire sectors the way investors once feared, but it will likely keep widening the gap between the winners and losers.—LB

      

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Stocks

🟢 What’s up

• Veeva Systems jumped 15.19% on an earnings beat and stronger-than-expected guidance for the current quarter and full year.
• Dollar General climbed 2.55% after topping quarterly estimates and raising its full-year earnings outlook.
• Digital asset treasury company Hyperliquid Strategies rallied 10.99% after fiscal 2026 results exceeded expectations across several key measures.
• Okta popped 28.63% on an earnings beat and higher guidance, helped by growing demand for cybersecurity tools tied to AI adoption.

🔴 What’s down

• Wendy’s sank 13.55% following reports that Nelson Peltz’s Trian no longer plans to pursue a takeover, citing concerns about the burger chain’s strategy.
• Celsius fell 6.36% on a Deutsche Bank downgrade that cited “fundamental challenges” for the energy drink maker.
• Dollar Tree dropped 3.99% despite an earnings beat, as a weak third-quarter outlook and pressure on profit margins spooked investors.
• Burlington Stores tumbled 7.64% after quarterly sales fell short and its third-quarter outlook missed Wall Street estimates.
• Best Buy slipped 4.44% despite beating estimates and raising its outlook, with investors focused on sluggish profit margins, excluding tariff refunds.
• Hormel Foods declined 10.19% after cutting its annual sales outlook amid weaker revenue and pressured consumer spending.
• HP fell 2.92% despite beating quarterly estimates, as weaker PC and printing unit sales overshadowed the results.
• Build-A-Bear plunged 27.26% after it fired its chief growth officer—which is fair, considering the company now forecasts much lower revenue growth.
• Callaway Golf lost another 1.91% as the fallout from its controversial new ad continues.

Q&A of the day

The AI trade is growing up

Callie Cox

The AI trade is getting a lot bigger than Big Tech: Investors are increasingly looking beyond the Magnificent Seven and toward the companies supplying the chips, power, real estate, and infrastructure needed to build out the technology. At the same time, stubborn inflation, a strange labor market, and growing access to private investments are giving investors plenty more to think about beyond AI.

Few people enjoy untangling all of that more than Callie Cox. A former Bloomberg reporter turned market strategist, Cox has built a following by making Wall Street a little less intimidating through her OptimistiCallie newsletter. Brew Markets caught up with her to talk about where the AI trade goes from here, what’s really going on in the labor market, and why buying into private companies isn’t always as simple as it sounds.

There’s been a trend emerging where investors are rotating out of your typical Magnificent Seven stocks, and the AI ecosystem is broadening out. Can you speak a little bit to that trend? Do you see this as a new era for tech?

The AI trade has been going on for four years now, and AI in itself is a compelling story. Your neighbors probably know about OpenAI and Claude. They’ve probably used AI to help them in some way or another in their daily routines. And the stock market picked up on this back in 2022, 2023.

But the thing with innovation is that investments around an innovative theme tend to go through phases. There’s the “everything works” hype phase, and then investors start scrutinizing what could work and who the winners and losers could be. And we’re a few years into that, I’d say.

So what we’ve seen this year is a rotation out of the hyperscalers, the big spenders, the names we all know that have deep pockets to chase AI ventures, into the “picks and shovels,” they call it: the industrial companies, the real estate companies, the materials companies that could help build out what we need to power the technology and data centers.

And to me, that’s just another step in this big, compelling story that’s AI. But of course it’s painful, because investors are forced to make choices here.

So I think investors are realizing that and trying to skate where the puck is going. And unfortunately, that means they have to make tough choices. And the hyperscalers seem to be the have-nots now.

The other thing I’ll add is that I think Big Tech is going through an interesting identity crisis where they’re the strongest, most profitable companies on the market, but they need to spend hundreds of billions of dollars to stay abreast of the AI trend. And you can’t be both at once. If you’re spending hundreds of billions of dollars, you’re cutting into your free cash flow.

And investors are looking at these huge conglomerates and saying, okay, are these the nimble startups that we think could win the AI trade? I’m not so sure. Will we see a payoff after they spend hundreds of billions of dollars to build this out? So I think there’s a secondary story going on with that.

Click here to keep reading about which sectors Cox thinks investors should be watching, how to approach private markets, and more.

Airlines

Morning Brew Inc.

Feel like jetting off to Ljubljana, Slovenia? Well now you can thanks to United Airlines, which just added 10 new international cities to its travel schedule, including Okinawa, Ibiza, and Marseille.

United already has more international flights than any other domestic airline, and this new batch of destinations is its largest international expansion ever. But American Airlines refused to be left behind, and today revealed seven new international routes of its own, with destinations like Vienna and Reykjavik.

Everybody’s flying high

Despite the rising cost of living thanks to higher inflation (not to mention the rising cost of airline tickets thanks to higher oil prices), demand for air travel remains strong. So strong, in fact, that airlines are looking further afield for new destinations as travellers seek adventures off the beaten path.

Customers also want more bang for their buck, and have begun booking big trips abroad outside of the expensive summer travel season. United CEO Scott Kirby told CNBC that October has become the airline’s best month of the year, while American plans to keep the new Vienna route open through January to encourage more Christmas travellers.

More miles, more money

And of course, business is booming for international travel. American Airlines reported record quarterly revenue of $16.7 billion in Q2, up more than 16% year-over-year. Its international business was a key contributor: Revenue per passenger for the airline’s Atlantic business segment rose 8.9% year-over-year, sales jumped 15.1% for its Pacific business, and revenue for its Latin America segment gained 6.6%.

As for United, it beat Wall Street forecasts last quarter thanks in no small part to its international revenue, which popped 11% in Q2. Global travel now accounts for about 41% of the company’s total revenue.

Both companies are betting that demand for international travel remains sky-high, and both are set to continue reaping the rewards.—MR

      

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News

• WWIII soft launch? CIA Director John Ratcliffe traveled to Moscow to tell Russia not to attack NATO nations.
• At least 100 tech companies inked a letter to policymakers, encouraging them to “act decisively” to prioritize cybersecurity against AI threats.
• South Korea’s SK Hynix is constructing a major memory-chip production facility in Indiana.
• Anthropic just rolled out a new interface that will help AI agents communicate with the physical world.
• This is the story behind Foot Locker’s epic downfall.
• SpaceX wants to build a $100 billion spaceport in Louisiana. Where’s all that cash coming from?

Calendar

There aren’t any earnings announcements of note, and the sole economic report worth watching is the University of Michigan’s final reading on consumer sentiment for the month of August.

But that doesn’t mean you should just call it a day: It’s not hyperbole to say that every analyst on Wall Street will be tuning in to Fed Chair Kevin Warsh’s keynote address at the 2026 Jackson Hole Economic Policy Symposium.

Warsh has played it closer to the vest than his predecessor, refusing to give hints about where he thinks interest rates are heading, and instead preferring to allow Treasury traders to dictate the direction of yields. But with US debt rising, inflation remaining far above the Fed’s target, and the bond market on a knife’s edge, he may have no choice but to provide some direction for investors tomorrow afternoon.

recs

💸 Good news: There are more ETFs than ever before. Bad news: There are more ETF closures than ever before. Here’s what happens to your money when a fund shuts down.

📈 All eyes are on bond yields, but don’t forget about the humble dividend stock: Here are three top picks that can generate consistent income.

🤑 You want to make some money? Here are the 10 ways people actually build wealth in America.

💪 Micro-cap stocks have outperformed their small-, mid-, and large-cap counterparts for the better part of a year now, and nobody has noticed. Check out these tiny stocks with huge returns.

📉 Hyperscalers are selling debt at a ridiculous rate. Here’s how it tanks the economy.

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