The premarket is calm without unnecessary fuss — but this is no euphoria. The market is taking a breather ahead of a week that will set the tone for the rest of August: CPI tomorrow, PPI on Thursday, and then the event in Jackson Hole on August 21–23, where the Federal Reserve will have a platform to fine-tune its September message.
The key question for traders is straightforward: will slowing inflation and soft labor market data be enough for the regulator to cut interest rates as early as September, or will the tariff factor once again delay the turn in monetary policy?
The weekend backdrop looks fairly bullish: last week, the Nasdaq jumped by 3.9%, the S&P 500 gained 2.4%, and the Dow added 1.3% — growth was driven by megacap stocks and resilient earnings, while ignoring protectionist noise.
Fundamentally, the market picture is a neat but fragile structure of expectations. The Bureau of Labor Statistics has set the timeline clearly: the July CPI release is scheduled for Tuesday, August 12. The consensus forecast for the core index is +0.3% m/m, which would lift the annual inflation rate to 3%.
For the market, this is almost an ideal compromise: soft enough not to break rate-cut expectations, and warm enough to avoid stoking fears of income deflation.
Federal funds futures are pricing in a high probability of a September rate cut and about 50–60 bps of easing by year-end — two quarter-point cuts, with an option for a third if labor market data continues to "creak." This is not just sentiment — it's monetary reality embedded in prices and durations, and it is precisely what fuels capital flows into duration-sensitive sectors.
Political noise is not background — it's a variable in the risk-premium equation. The market is pricing in an extension of the US–China tariff truce; the August 12 deadline hangs over tech stocks like an extra weight.
The news tape also contains a sharper note: according to Reuters, a model is being discussed under which Nvidia and AMD would transfer 15% of their China sales revenue to the US budget in exchange for export licenses. If this scenario is locked in, the market will remove part of the regulatory overhang on semiconductor exports — but the margin trade-off in semiconductor valuations will be unavoidable.
Jackson Hole is not "an event for the sake of an event" — it's where the Fed usually discreetly moves its markers. This year, the Kansas City Fed will officially host the symposium on August 21–23, with the theme "Labor Markets in Transition." Officially, it's about demographics and productivity; unofficially, it's about how to explain the path to a soft landing without losing face. Any hint that employment will take priority over inflation will be read as a green light for a September rate cut.
In the corporate flow, the focus is also clear. Megatech remains the engine: the market is playing the decline in yields, the potential regulatory resolution on exports, and news surrounding autonomous services.
After Tesla's June robotaxi test in Austin, the driverless theme is back in play amid tighter state rules and legal risks; for beta it's fuel, for valuation — volatility. Pinterest, by contrast, dropped more than 10% on weak adjusted profit, showing that advertising remains cyclical and that earnings revisions are not only about rates, but also about consumer elasticity.
Technical picture
On S&P 500 futures, 6,390 is not just a nice number on the board — it's the upper border of the latest impulse corridor and the point where three interests converge: the urge of late buyers to "catch the train," the need to lock in gains for those who entered below 6,200, and the mark for systematic CTAs adding on a breakout.
Above 6,400, the market turns the current zone into support and quickly tests 6,425–6,450 — where, by muscle memory, the limits will kick in for those selling volatility and defending strikes.
Below 6,350, risk management is simple: a slide to 6,310–6,320, where swing-long stops sit, and below them a strong magnet around 6,250, coinciding with the sloping support of the July rally.
Day scenario. "Buy the dip" while holding 6,350, with partial profit-taking at 6,420–6,450. Surprise scenario. A breakout above 6,400 before CPI, with a quick liquidity sweep and return to 6,370 if players avoid carrying release risk on their backs.
The Nasdaq 100 at 23,630 confirms the ongoing uptrend. The picture here is more aggressive: every cooling tick in yields turns into fuel for the AI basket and cloud names.
The 23,750–23,950 zone is where shorts were covered on Friday, and late long positions are pausing today. A sustained break opens a highway to 24,000 and beyond, then redraws targets based on momentum models. On the downside, the "line in the sand" runs near 23,350. Once it is lost, the door will be open to 23,100, and this forces the market to reassess CPI risk, especially if a breakout does not happen. Here, the key is not just index prices but how semiconductors react to any trade headlines — they will be the first to snap the impulse.
Weekly outlook. The market's stance is simple and honest, like a scalper's desk: until the data is out, the bulls hold the initiative and stretch the spring. A "normal" CPI with core at 0.3% m/m will allow the market to climb higher under the narrative of the September rate cut, leaving Jackson Hole as a ceremonial confirmation of the course.
A "hot" CPI will shatter the fragile consensus, steepen the yield curve, and hit rate-sensitive sectors — starting with high-tech and REIT stocks— and squeeze index multiples. A "cold" surprise will be perfect for short-term momentum, but strategically will spark more talk about rising recession risks and quietly shift the focus to consumer-sector earnings.
At the intersection of tariffs and rates, any week becomes a choice between speed and stability. Today, stock investors choose prompt decisions, placing stop orders closer than usual.
