It’s Happening
Good morning: Equity markets rallied for the first time in three weeks, with all three major indices posting weekly gains. Strong AI-earnings releases helped push stocks higher to overcome a weaker than expected gross domestic product report and divided the Federal Reserve, causing some volatility. The U.S. economy grew at a 1.5% annualized rate in the second quarter, slowing from the previous quarter. Strong consumer spending and AI-driven business investment supported growth. The weaker-than-expected growth rate reinforced the Fed’s decision to hold rates steady at a range of 3.50%-3.75%. Continued economic uncertainty and elevated inflation ultimately kept the central bank in wait-and-see mode.
So far, 61% of S&P 500 companies have reported their quarterly results. Of those companies, the blended earnings growth rate is 47.4%, the highest since the post-covid reopening in 2021 (source: Factset). This week’s economic releases will be labor-focused, with the Bureau of Labor Statistics payrolls report being released this Friday and the Challenger job cuts report on Thursday. On top of that, we will get the ISM Manufacturing and Non-Manufacturing reports for July. Earnings season also continues this week with another flurry of releases. We will hear from SpaceX, which will make its first public release following its IPO. The incredible investment amounts that have gone to AI infrastructure are beginning to pay off—I emphasize beginning. We’re still in the early stages; it is happening. Have a great week, and call with questions.
Source: “Corporate Earnings Show Strong Deman for AI.” Monday Morning Observations. Capital Wealth Management. Simpson, K. 8/3/2026
Regards,
Don
Wells Fargo Advisors Financial Network did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of the author(s) and are not necessarily those of Wells Fargo Advisors Financial Network or its affiliates. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request.
Investment product and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. a registered broker-dealer and non-bank affiliate of Wells Fargo & Company. WFAFN uses the trade name Wells Fargo Advisors.
The S&P Index consists of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market value weighted index with each stock’s weight in the Index proportionate to its market value. Index returns are not fund returns. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results.
So far, 61% of S&P 500 companies have reported their quarterly results. Of those companies, the blended earnings growth rate is 47.4%, the highest since the post-covid reopening in 2021 (source: Factset). This week’s economic releases will be labor-focused, with the Bureau of Labor Statistics payrolls report being released this Friday and the Challenger job cuts report on Thursday. On top of that, we will get the ISM Manufacturing and Non-Manufacturing reports for July. Earnings season also continues this week with another flurry of releases. We will hear from SpaceX, which will make its first public release following its IPO. The incredible investment amounts that have gone to AI infrastructure are beginning to pay off—I emphasize beginning. We’re still in the early stages; it is happening. Have a great week, and call with questions.
Source: “Corporate Earnings Show Strong Deman for AI.” Monday Morning Observations. Capital Wealth Management. Simpson, K. 8/3/2026
Regards,
Don
Wells Fargo Advisors Financial Network did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of the author(s) and are not necessarily those of Wells Fargo Advisors Financial Network or its affiliates. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request.
Investment product and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. a registered broker-dealer and non-bank affiliate of Wells Fargo & Company. WFAFN uses the trade name Wells Fargo Advisors.
The S&P Index consists of 500 stocks chosen for market size, liquidity, and industry group representation. It is a market value weighted index with each stock’s weight in the Index proportionate to its market value. Index returns are not fund returns. An index is unmanaged and not available for direct investment. Past performance is no guarantee of future results.