Morning in New York: blockchain and Fed news will set the trading vector

Daily review and forecast of events on the U.S. stock market from Mikhail Denislamov, Deputy Director of Freedom Capital Markets Research.

The upcoming session will be centered on the publication of the minutes of the July FOMC meeting. The details of the committee's discussion may influence the market sentiment ahead of its September meeting. It is important for investors to assess how ready the regulator is for easing the MPC and whether it is possible to accelerate rate cuts if inflation continues to slow down.

Also of interest to stock exchange players are the speeches of the Fed's leadership at the blockchain symposium in Wyoming. Members of the Board of Governors, including Christopher Waller, may outline the regulator's stance on digital assets and tokenization. The event comes shortly after the state launched its own Frontier Stable Token (FRNT) stackcoin, backed by "short" U.S. Treasury securities and integrated with Visa's payment system. Initiatives like this allow the Fed to demonstrate a balance between innovation and regulation, and Waller's comments may shed light on the perception of digital currencies in the context of future monetary policy.

Before the main session opens, The TJX Companies (TJX), Lowe's Companies (LOW), Target Corporation (TGT), Analog Devices (ADI), Estee Lauder (EL), Baidu (BIDU) and Futu Holdings (FUTU) will report quarterly results. Nordson (NDSN), Coty (COTY) and FinVolution (FINV) will report at the postmarket.

Futures on American indices demonstrate moderately negative dynamics. Investors will follow the demand for the securities of the beneficiaries of the AI-trend, which sagged the previous day. Despite the absence of significant triggers, capital flow into other industries may continue by inertia and will be perceived as a natural process.

We assess the balance of risks for the upcoming session as neutral with an average level of volatility. We focus on the S&P 500 movements in the range of 6360-6460 points (from -0.8% to +0.8% to the closing level of the previous session).

- Palantir (PLTR) shares were down another 2% in the post-market on August 19 after plunging 9.35% in the main session. It strengthened investors' concerns about overvaluation of the securities and sustainability of growth in the AI segment.

- Alcon (ALC) reported $2.58 billion (+3.8% YoY) in revenue for the quarter, compared to the consensus of $2.61 billion, and its EPS came in at $0.76, with average expectations of $0.71. Despite the positive EPS surprise, investors focused on the weak earnings, and ALC stock declined by 7% in the post-trading session.

- La-Z-Boy (LZB) reported revenue of $492.2 million for the latest quarter in line with mid-market guidance, and adjusted EPS at $0.47 was 10.8% below expectations. Additional pressure on the quotations, which collapsed by 23.6% after closing, was exerted by the guideline for the current quarter, assuming revenue of $520 mln against the consensus of $528 mln.

- James Hardie (JHX) reported weak results for the first quarter of fiscal 2026 and worsened its earnings guidance given the unfavorable environment in the U.S. housing segment. Against this backdrop, the company's shares collapsed 24.4% in the post-market.

August 19 trading on the U.S. stock exchanges ended mostly with a decline. S&P 500 lost 0.59%, Nasdaq 100 fell by 1.39%, Russell 2000 fell by 0.78%, only Dow Jones added a modest 0.02%. All of the "Magnificent Seven" stocks closed in the negative. NVIDIA (NVDA: -3.5%) fell the most due to the correction in the chipmaker sector, while Apple (AAPL: -0.14%) declined the least. The real estate sector (XLRE: +1.78%) was the leader of growth. The IT sector (XLK: -1.75%) was the outsider. Pressure on the broad market was exerted by profit taking in the megacap segment and sell-offs in the technology sector. At the same time, interest in defensive assets increased. There were no obvious triggers for the movement, but the media expressed versions from a decrease in risk appetite before the upcoming speech of Jerome Powell on August 22 at the symposium of heads of world central banks in Jackson Hole to the cooling of interest in AI-mathematics after the head of OpenAI Sam Altman suggested the emergence of a "bubble" in this area.

Construction starts in July increased by 5.2% mom to 1.43 million units, with expectations of a 1.7% mom decline after a 4.6% mom increase in June. Multifamily projects (+9.9% m/m) continued the positive trend, with the single-family segment up 2.8% m/m. Building permits fell 2.8% m/m to 1.35 million, with consensus at 1.39 million (-0.2% m/m) after -0.1% m/m in June. The indicator reached its lowest level since 2020 and recorded its seventh decline in the last eight months. This dynamic points to volatility in the sector, especially with mortgage rates remaining high.

- Investment bank Mizuho Securities USA revised its rating on Prologis (PLD: +5.1%) to 'above market', citing an improving macro backdrop and the potential for growth in space utilization in the second half of this year and next year.

- Home Depot (HD: +3.2%) reported lower EPS and comparables for the quarter, but its U.S. sales rose 1.4% and its big check increased 2.6%, which the market took as a positive signal. The retailer's management reaffirmed its full-year guidance.

- Medtronic's (MDT: -3.1%) quarterly results beat average expectations, slightly increasing EPS guidance for the year. It also became known about the entry of Elliott Management into the company's capital and possible personnel changes in the board of directors.

- Viking Holdings (VIK: -1.6%) generated better-than-consensus revenue and EBITDA in the quarter, but investors were disappointed by the announcement that it would maintain its guidance of 4% earnings growth by 2026.

This article was AI-translated and verified by a human editor