Tuesday's session closed strongly green - and tech-skewed in a way that is hard to miss.
| Close | Change | |
|---|---|---|
| Nasdaq 100 ETF | 723.85 | +3.40% |
| S&P 500 ETF | 771.33 | +1.80% |
In dollars. Figures per the ETFs tracking the indices.
The Nasdaq 100 did almost double the S&P 500. This is not an ordinary green day - it is a day when money flowed into something specific.
The morning reports, and the reaction to them
Caterpillar: a historic record, and an opening that faded
Caterpillar reported the first quarter in its history above $20 billion - $20.543 billion, up 24%, with adjusted EPS of $8.17 against $4.72 a year ago.
And the reaction was dramatic, and then less so:
| Previous close | 830.03 |
| Open | 922.00 (+11.1%) |
| Day high | 934.99 |
| Close | 876.54 (+5.60%) |
So the stock opened up 11% and gave back almost half of it by the close.
Which makes sense given what we wrote in the morning: inside operating profit sit $392 million of one-off tariff recoveries - roughly 1.9 percentage points of margin. Anyone who read the report closely during the day found that line.
Cipher: the biggest loser of the day
Cipher crashed 15.65% to $20.38, on enormous volume of 61.5 million shares.
Revenue of just $24.8 million, down 43%, and a net loss of $267.5 million.
And as we wrote, the correct reading is more complex: the sole revenue line in the report is called "Revenue - bitcoin mining", and the company has already renamed itself Cipher Digital. This is the last quarter of the old business.
But the market did not price the explanation - it priced the leverage: $5.45 billion of debt against $562 million of falling equity.
Tower: the wildest move of the day
Tower Semiconductor traversed a range of almost 21% in a single day:
| Previous close | 234.32 |
| Day low | 206.40 (-11.9%) |
| Day high | 250.36 (+6.8%) |
| Close | 239.53 (+2.22%) |
The stock fell almost 12% and then recovered to a positive close.
And a reminder of what was in the report: record revenue of $460 million, gross profit up 72%, and third-quarter guidance of $520 million. Silicon photonics at a $680 million annual run rate against $180 million a year ago.
AudioCodes
AudioCodes rose 2.45% to $10.04, on modest volume of 334 thousand shares.
And the phenomenon of the day: the market bought before it saw
And here is the figure that interests me more than any other.
Four companies reported only after the close - and yet all of them jumped during the session, before the numbers were published at all:
| Company | Close | Change | Volume |
|---|---|---|---|
| Astera Labs | 361.67 | +12.65% | 10.1M |
| SpaceX | 125.33 | +9.43% | 144.1M |
| AMD | 518.58 | +7.00% | 48.5M |
| Arista | 190.51 | +3.04% | 14.1M |
And why that deserves attention
These moves are not a reaction to a report. They preceded it.
Meaning the market bought the entire AI infrastructure chain on expectation - not on numbers.
And that explains the gap between the indices: the Nasdaq 100 rose 3.40% against 1.80% for the S&P 500, because the money flowed into a very specific group.
And on that very same day, the one company in the group that did publish numbers in the morning - Cipher - fell 15.65%.
That is the picture in one sentence: the market paid a premium for expectation, and charged a price for disappointment, on the same day.
And as published after the close, the numbers were indeed strong: AMD with $11.5 billion and a 107% jump in Data Center, Arista with its first quarter above $3 billion and a 49.9% adjusted operating margin, and Astera Labs with $392 million and 104% growth. The reaction to those numbers will be measured in Wednesday's session.
Three utilities, on the same day
A detail worth noting: on the same day Caterpillar wrote in its release that power generation sales rose "primarily in data center applications", three American utilities also reported: Duke Energy, NRG Energy and Public Service Enterprise Group.
We did not analyse their reports, but the combination marks where the market's centre of gravity sat that day.
And two more from the field reported: Hut 8, a mining company that pivoted like Cipher into high-performance computing, and Blackstone Digital Infrastructure Trust, a fund specialising in digital infrastructure.
Who else reported today
For completeness of the record - additional companies that filed results with the SEC that day. We did not analyse their numbers, and the list is provided as documentation only:
Archer-Daniels-Midland, Duke Energy, DuPont, McDonald's, Marathon Petroleum, Cummins, Energy Transfer, NRG Energy, Public Service Enterprise Group, Ball, AMETEK, Zebra Technologies, Fidelity National Information Services, Apollo Global Management, TPG, Athene, Kimberly-Clark, IDEXX Laboratories, Revvity, Aptiv, Wayfair, Kimco Realty, UL Solutions, Timken, Graphic Packaging, Westlake, Westlake Chemical Partners, Hut 8, Blackstone Digital Infrastructure Trust, Wix.com, Grab Holdings, Ingredion, Trex, ADTRAN, OPENLANE, Xometry, Certara, AdaptHealth, Enpro, Hillman Solutions, Thryv, Albany International, Knife River, Centuri, LGI Homes, Millrose Properties, Standard Motor Products, Turning Point Brands, Superior Group of Companies, USA Compression Partners, Chatham Lodging Trust, Willis Lease Finance, Wheels Up, United Parks & Resorts, Vivid Seats, PSQ Holdings, SOPHiA Genetics, Brightstar Lottery, TETRA Technologies, Ares Commercial Real Estate, Qnity Electronics, RYTHM, IQM Quantum Computers, Strata Critical Medical, Versigent.
And from Israel, besides Tower and AudioCodes, Wix also filed - the Nasdaq-listed Israeli company. We did not analyse its report.
What is coming tomorrow
Wednesday, 5 August: Eli Lilly, Western Digital, SanDisk, Disney, Uber, GlobalFoundries, Axon and IonQ. And in Israel: ICL, NICE, Bezeq, Ormat and Gilat.
My Angle
A personal opinion of Ilan Abramov - not advice, not a recommendation
The detail I take from today is not Caterpillar and not Cipher - it is the gap between them.
On that same day, the entire AI infrastructure chain rose between 3% and 12.65% before any of them published a number. And on that same day, the one company from that chain which did publish numbers in the morning fell 15.65%.
That says something about the phase of the market we are in. When a stock rises 12% on reporting day, before the report, the price already embeds a good result - and that is exactly what makes the next day's reaction unpredictable, even when the numbers are strong.
And what reinforces it is Caterpillar. It reported a historic record quarter, opened up 11% - and closed at 5.60%. Not because the report was weak, but most likely because of $392 million of tariff recoveries that anyone reading closely found inside.
The market is in a state where it buys fast and reads slowly. Those two things do not always end up agreeing.
