The visible story on Thursday was a memory-chip Investor Day and a cooperative inflation print. The less visible one, and probably the more important one, was the US Treasury paying the highest yield on 30-year debt since 2001.
Both threads ran through the same tape, and the market chose which one it wanted to hear.
The Rundown
- July producer prices came in cooler than expected, further trimming the market-implied probability of a September Fed hike.
- A memory chipmaker's Investor Day reset how investors think about NAND economics and pulled the flash complex sharply higher.
- Several AI-adjacent names beat consensus and still got sold hard as expectations ran ahead of even record prints.
- The long end of the Treasury curve keeps drifting higher, quietly repricing what it costs to finance a debt load closing in on $40 trillion.
PPI Cools, Fed Pressure Eases
July producer prices came in soft across the board.
Headline PPI slowed to 4.7% year-over-year from 5.5% in June, and the month-on-month print was flat. Ex-food and energy, the number was 0.2% against a 0.4% consensus. Combined with Wednesday's cooler CPI, the case that the July inflation impulse is fading is now hard to argue against.
Weekly initial jobless claims rose 9,000 to 209,000, a small miss versus 204,000 expected, but consistent with a labor market that continues to soften rather than break.
Fed funds futures now put the odds of a September hike at roughly 35%, down from close to 50% earlier this week. The 10-year yield eased 6 basis points to 4.64%. Brent broke a six-session grind higher and fell more than 2% to $87 as both the IEA and OPEC nudged their 2026 demand forecasts lower.
SanDisk Rewrites the NAND Story
The tape's biggest single-name move belonged to SANDISK CORP (SNDK | ???13.67%), which surged into its Investor Day and closed 14% higher. The stock has now roughly sextupled year-to-date on the back of the NAND price cycle, and management just made the case that the cycle isn't the whole story.
The 2028-2030 guide points to 15-20% annual revenue growth, gross margins holding near 80%, and free cash flow margins around 50%. The pitch: NAND supply discipline plus insatiable AI-datacenter storage demand, with SanDisk sizing the flash market at 1.2 zettabytes by 2030, can keep the margin structure intact for longer than the sceptics assumed.
The read-through was immediate.
WESTERN DIGITAL CORP (WDC | ???7.31%) and MICRON TECHNOLOGY INC (MU | ???4.23%) went along for the ride as the market extended the "structurally higher NAND margins" thesis across the peer set.
The standard critique of the memory rally has always been that cyclicality catches up in the end. SanDisk's message on Thursday was that management intends to manage supply rather than chase share, and to return excess cash rather than reinvest it into a price war. That's a very different posture from prior memory cycles, and a lot of the day's rally was investors pricing in the possibility that this time management is serious.
Cisco and Cerebras: When A Beat Isn't Enough
Not every AI-adjacent name got the benefit of the doubt.
CISCO SYSTEMS INC (CSCO | ???8.40%) topped consensus on both revenue and EPS and booked $9.3 billion in AI-related orders for the fiscal year. But gross margins slipped, and a full-year guide of $7.5 billion in AI-linked revenue underwhelmed expectations that had been building quietly for weeks.
After a 60% year-to-date rally, the bar was set well above the actual print. This is the same dynamic that punished several enterprise software names earlier in the week: the market is now pricing perfection into anything with an AI narrative attached.
CEREBRAS SYSTEMS INC - A (CBRS | ???11.85%) told a related story from a different angle. The AI-compute name, public since May, grew revenue meaningfully and raised its full-year guide, but reported revenue missed and the net loss expanded to $451 million.
For an IPO whose thesis rests on catching up to Nvidia's ecosystem, a missed print with a widening loss reads less like growing pains and more like an unfinished margin story.
Birkenstock's Full-Price Discipline Pays Off
Away from the AI axis, BIRKENSTOCK HOLDING PLC (BIRK | ???11.59%) delivered the day's second-largest headline move on strong Q3 numbers and a raised full-year guide.
- Revenue was up 13% to €720 million, with direct-to-consumer sales up 16% on constant currencies and Asia-Pacific leading regionally at +23%.
- EPS of €0.74 was a hair below consensus, but the market focused instead on the guide, full-year 2026 revenue growth now expected at 15% constant-currency versus the prior 13-15% band,
- and EBITDA lifted to at least €710 million.
The interesting subplot is margin discipline. Gross margin slipped from 60.5% to 59.1% on FX headwinds and US import tariffs, but almost all volume was sold at full price.
In a consumer environment where softline retailers are still discounting to move inventory, that's a genuine differentiator. It also tells you something about what a strong brand actually looks like when priced against a wobbly consumer.
The 30-Year Auction Nobody Is Cheering
The Treasury sold $25 billion in 30-year bonds at 5.216%, the highest yield on 30-year paper since 2001. That comes on top of Wednesday's 10-year auction that cleared at 4.683%, itself the highest since 2007. Two auctions, two multi-decade highs. The message from long-duration buyers is consistent: they want a lot more compensation to hold US debt.
The two components of that risk should be familiar by now.
First, the Fed has missed its 2% inflation target for five years running, and the Iran-linked energy shock keeps a floor under the number. Second, US public debt is closing in on $40 trillion, north of 120% of GDP, with no discipline on the horizon from either side of the aisle.
New Fed Chair Kevin Warsh's Jackson Hole appearance later this month is going to matter more than usual, and his early communication has been described charitably as uneven. The long end of the curve is his most direct performance review. A benign PPI print helps in the front end. It doesn't fix what's happening at 30 years.
Ackman Repositions, Reddit Gets an Index Bid
Bill Ackman's Pershing Square disclosed a set of new positions that reads like a quality-at-any-price shopping list: VISA INC-CLASS A SHARES (V | ???1.68%), MASTERCARD INC - A (MA | ???1.31%), NETFLIX INC (NFLX | ???5.43%), S&P GLOBAL INC (SPGI | ???3.07%), INTERCONTINENTAL EXCHANGE IN (ICE | ???2.58%) and ALCON INC (ALC | ???0.08%).
The through-line is franchises with wide moats and predictable cash generation, exactly what you would expect from an investor whose new fund has trailed the S&P since its April listing and who publicly admits to having missed the chip cycle entirely. Whether it's a genuine strategic pivot or a bid to reassure investors after a rough first act, the names themselves are hard to argue with.
REDDIT INC-CL A (RDDT | ???3.04%) will replace AvalonBay Communities in the S&P 500 as of August 18, and jumped roughly 12.6% in after-hours trade on the news. The mechanical piece is straightforward: index funds are now forced buyers.
The interesting piece is the debate that surrounds it. Bears argue AI chatbots are quietly siphoning off search-driven traffic. Bulls counter that Reddit's uniquely human-generated content archive is exactly what OpenAI, Google and others are paying serious money to license for model training. Both can be true at once, and probably are.
TAPESTRY INC (TPR | ???16.49%) took the S&P 500's worst hit of the day on a disappointing outlook, adding to a slide that started earlier in the week.
Applied Materials Delivers, Market Sells
After the close, APPLIED MATERIALS INC (AMAT | ???2.48%) reported record quarterly revenue of $9.12 billion, a GAAP gross margin of 50.3%, record operating income of $3.08 billion (33.7% of revenue), and EPS of $3.17.
Net income rose 43% year-over-year to $2.54 billion, and the company returned $860 million to shareholders through buybacks and dividends. CEO Gary Dickerson lifted the calendar-2026 Semiconductor Systems outlook and telegraphed another strong growth year in 2027.
The stock fell 3.8% after-hours to $514.17. Same pattern as Cisco: a genuinely strong print, but the bar was already too high. When a name has this much AI-capex tailwind priced in, "record" starts to feel like the minimum acceptable outcome.
Conclusion
Thursday had two layers. The visible layer was a benign inflation print, a NAND-driven rally led by SanDisk, and a punishing tape for anything with high AI expectations that failed to blow past them, Cisco and Cerebras in the regular session, Applied Materials after the close.
The quieter layer was the 30-year auction, and it's the one I keep returning to. The front end can rally on every soft data point between now and Jackson Hole, but the long end is telling a different story about credibility, inflation persistence, and fiscal trajectory. That's the number I'd keep on top of the screen through the rest of August.
ChartMill Market Desk - Kristoff
With regard to the stocks discussed in the article above; the author owns individual shares in Netflix.
This daily update is prepared by ChartMill for informational purposes only and does not constitute investment advice. Always do your own due diligence before making investment decisions.
Read full article here »
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SanDisk's Investor Day Puts NAND Center Stage as the 30-Year Quietly Prices In Fiscal Reality
The visible story on Thursday was a memory-chip Investor Day and a cooperative inflation print. The less visible one, and probably the more important one, was the US Treasury paying the highest yield on 30-year debt since 2001.
Both threads ran through the same tape, and the market chose which one it wanted to hear.
The Rundown
PPI Cools, Fed Pressure Eases
July producer prices came in soft across the board.
Headline PPI slowed to 4.7% year-over-year from 5.5% in June, and the month-on-month print was flat. Ex-food and energy, the number was 0.2% against a 0.4% consensus. Combined with Wednesday's cooler CPI, the case that the July inflation impulse is fading is now hard to argue against.
Weekly initial jobless claims rose 9,000 to 209,000, a small miss versus 204,000 expected, but consistent with a labor market that continues to soften rather than break.
Fed funds futures now put the odds of a September hike at roughly 35%, down from close to 50% earlier this week. The 10-year yield eased 6 basis points to 4.64%. Brent broke a six-session grind higher and fell more than 2% to $87 as both the IEA and OPEC nudged their 2026 demand forecasts lower.
SanDisk Rewrites the NAND Story
The tape's biggest single-name move belonged to SANDISK CORP (SNDK | ???13.67%), which surged into its Investor Day and closed 14% higher. The stock has now roughly sextupled year-to-date on the back of the NAND price cycle, and management just made the case that the cycle isn't the whole story.
The 2028-2030 guide points to 15-20% annual revenue growth, gross margins holding near 80%, and free cash flow margins around 50%. The pitch: NAND supply discipline plus insatiable AI-datacenter storage demand, with SanDisk sizing the flash market at 1.2 zettabytes by 2030, can keep the margin structure intact for longer than the sceptics assumed.
The read-through was immediate.
WESTERN DIGITAL CORP (WDC | ???7.31%) and MICRON TECHNOLOGY INC (MU | ???4.23%) went along for the ride as the market extended the "structurally higher NAND margins" thesis across the peer set.
The standard critique of the memory rally has always been that cyclicality catches up in the end. SanDisk's message on Thursday was that management intends to manage supply rather than chase share, and to return excess cash rather than reinvest it into a price war. That's a very different posture from prior memory cycles, and a lot of the day's rally was investors pricing in the possibility that this time management is serious.
Cisco and Cerebras: When A Beat Isn't Enough
Not every AI-adjacent name got the benefit of the doubt.
CISCO SYSTEMS INC (CSCO | ???8.40%) topped consensus on both revenue and EPS and booked $9.3 billion in AI-related orders for the fiscal year. But gross margins slipped, and a full-year guide of $7.5 billion in AI-linked revenue underwhelmed expectations that had been building quietly for weeks.
After a 60% year-to-date rally, the bar was set well above the actual print. This is the same dynamic that punished several enterprise software names earlier in the week: the market is now pricing perfection into anything with an AI narrative attached.
CEREBRAS SYSTEMS INC - A (CBRS | ???11.85%) told a related story from a different angle. The AI-compute name, public since May, grew revenue meaningfully and raised its full-year guide, but reported revenue missed and the net loss expanded to $451 million.
For an IPO whose thesis rests on catching up to Nvidia's ecosystem, a missed print with a widening loss reads less like growing pains and more like an unfinished margin story.
Birkenstock's Full-Price Discipline Pays Off
Away from the AI axis, BIRKENSTOCK HOLDING PLC (BIRK | ???11.59%) delivered the day's second-largest headline move on strong Q3 numbers and a raised full-year guide.
The interesting subplot is margin discipline. Gross margin slipped from 60.5% to 59.1% on FX headwinds and US import tariffs, but almost all volume was sold at full price.
In a consumer environment where softline retailers are still discounting to move inventory, that's a genuine differentiator. It also tells you something about what a strong brand actually looks like when priced against a wobbly consumer.
The 30-Year Auction Nobody Is Cheering
The Treasury sold $25 billion in 30-year bonds at 5.216%, the highest yield on 30-year paper since 2001. That comes on top of Wednesday's 10-year auction that cleared at 4.683%, itself the highest since 2007. Two auctions, two multi-decade highs. The message from long-duration buyers is consistent: they want a lot more compensation to hold US debt.
The two components of that risk should be familiar by now.
First, the Fed has missed its 2% inflation target for five years running, and the Iran-linked energy shock keeps a floor under the number. Second, US public debt is closing in on $40 trillion, north of 120% of GDP, with no discipline on the horizon from either side of the aisle.
New Fed Chair Kevin Warsh's Jackson Hole appearance later this month is going to matter more than usual, and his early communication has been described charitably as uneven. The long end of the curve is his most direct performance review. A benign PPI print helps in the front end. It doesn't fix what's happening at 30 years.
Ackman Repositions, Reddit Gets an Index Bid
Bill Ackman's Pershing Square disclosed a set of new positions that reads like a quality-at-any-price shopping list: VISA INC-CLASS A SHARES (V | ???1.68%), MASTERCARD INC - A (MA | ???1.31%), NETFLIX INC (NFLX | ???5.43%), S&P GLOBAL INC (SPGI | ???3.07%), INTERCONTINENTAL EXCHANGE IN (ICE | ???2.58%) and ALCON INC (ALC | ???0.08%).
The through-line is franchises with wide moats and predictable cash generation, exactly what you would expect from an investor whose new fund has trailed the S&P since its April listing and who publicly admits to having missed the chip cycle entirely. Whether it's a genuine strategic pivot or a bid to reassure investors after a rough first act, the names themselves are hard to argue with.
REDDIT INC-CL A (RDDT | ???3.04%) will replace AvalonBay Communities in the S&P 500 as of August 18, and jumped roughly 12.6% in after-hours trade on the news. The mechanical piece is straightforward: index funds are now forced buyers.
The interesting piece is the debate that surrounds it. Bears argue AI chatbots are quietly siphoning off search-driven traffic. Bulls counter that Reddit's uniquely human-generated content archive is exactly what OpenAI, Google and others are paying serious money to license for model training. Both can be true at once, and probably are.
TAPESTRY INC (TPR | ???16.49%) took the S&P 500's worst hit of the day on a disappointing outlook, adding to a slide that started earlier in the week.
Applied Materials Delivers, Market Sells
After the close, APPLIED MATERIALS INC (AMAT | ???2.48%) reported record quarterly revenue of $9.12 billion, a GAAP gross margin of 50.3%, record operating income of $3.08 billion (33.7% of revenue), and EPS of $3.17.
Net income rose 43% year-over-year to $2.54 billion, and the company returned $860 million to shareholders through buybacks and dividends. CEO Gary Dickerson lifted the calendar-2026 Semiconductor Systems outlook and telegraphed another strong growth year in 2027.
The stock fell 3.8% after-hours to $514.17. Same pattern as Cisco: a genuinely strong print, but the bar was already too high. When a name has this much AI-capex tailwind priced in, "record" starts to feel like the minimum acceptable outcome.
Conclusion
Thursday had two layers. The visible layer was a benign inflation print, a NAND-driven rally led by SanDisk, and a punishing tape for anything with high AI expectations that failed to blow past them, Cisco and Cerebras in the regular session, Applied Materials after the close.
The quieter layer was the 30-year auction, and it's the one I keep returning to. The front end can rally on every soft data point between now and Jackson Hole, but the long end is telling a different story about credibility, inflation persistence, and fiscal trajectory. That's the number I'd keep on top of the screen through the rest of August.
ChartMill Market Desk - Kristoff
With regard to the stocks discussed in the article above; the author owns individual shares in Netflix.
This daily update is prepared by ChartMill for informational purposes only and does not constitute investment advice. Always do your own due diligence before making investment decisions.
Read full article here »