The stock market’s first week after the Big Tech earnings extravaganza went about as well as any investor could have hoped. The initial mixed bag of earnings gave way to general bullishness as AI’s spending worries receded somewhat.

And with Friday’s jobs report surprise, Fed rate bets were recalculated, sending stocks to the weekend on a high note.

The S&P 500 (^GSPC) closed out Friday up 0.6%, putting the index back into record-high territory.

As we putter through the back nine of this quarter’s earnings season, our focus will continue to be split between the drip of more companies opening their books and the economic data that will hopefully calibrate a Fed on the edge between holding and hiking rates.

Wednesday’s Consumer Price Index release is circled on the calendar, with economists expecting it to rise 0.2% — both the overall and core figures (no energy, no food). Thursday will see the wholesale version, with the Producer Price Index expected to also rise faster than last month. The week’s economic data will close with a reading on retail sales and U. Mich.’s consumer survey data on Friday.

On the corporate side, a calmer calendar includes results from CAVA Group (CAVA) on Tuesday, cloud infrastructure players Nebius Group (NBIS) and Cerebras Systems (CBRS) on Wednesday, and Applied Materials (AMAT) on Thursday.

Crucial inflation reports set the tone for future rate hikes  

Every inflation print can change the narrative. But this week’s CPI and PPI readings are even more important. 

Fed officials are already in disagreement over where to take interest rates next. And last week’s stinker of a jobs report splashed another helping of ambiguity into the mix.

A lousier-than-expected labor snapshot may have cooled the need for an imminent rate hike — the unemployment rate ticked down even as the economy shed jobs. But the central bank’s renewed focus on inflation means officials could be compelled to start tightening again by hotter-than-expected numbers, or even ones in line with expectations.

Bank of America’s Stephen Juneau mused on Friday that last month’s CPI was likely a “one-off” and that a “report in line with our expectations would strengthen the case for the Fed hiking in September.”

The new Fed chair’s challenges resemble those Powell faced. But with a subdued labor market still giving little meaningful signal (i.e., more than one report) that it’s too hot or too cold,  stubborn pricing pressures are likely to again play the deciding factor.

Consumer price inflation figures will arrive on Wednesday, followed by producer prices on Thursday. Economists expect both to rise somewhat, but just as Friday’s news showed us, the real thing we’re watching for is a surprise.

A fresh AI infrastructure vibe check 

The tech giants can give us a sense of where the AI transition is headed through spending, product announcements, and personnel. We’ve seen that those of the hyperscalers are, for the most part, happy and bullish with the state of affairs.

But AI infrastructure players are also key bellwethers on industry sentiment and the state of play on the international build-out. 

We hear from three important ones this week: Nebius Group (NBIS), CoreWeave (CRWV), and Cerebras (CBRS), which occupy a different landscape than the “Magnificent Seven” cohort.

The three companies’ year-to-date performances reflect the AI industry’s inconsistent reception, ranging from Nebius’ gleeful 122% gain and CoreWeave’s impressive 25% rise to chipmaker Cerebras’ painful 35% loss after a splashy IPO. The rush to stand up AI infrastructure might seem like a tide lifting all boats. But there’s a sea of red out there.

Just like the uneven records of the Magnificent Seven this year, cloud computing firms, data center operators, and semiconductor tickers have their own tiers of winners and losers. The earnings reports in the days ahead will shed more light on who’s who. 

At the very least, they’re reporting into a bullish moment for AI, thanks to a very solid table-setting over the past two weeks that delivered the stock market back to record highs.

2 developments reignite Fed independence concerns 

The recent rise in bond yields reflects a sense of greater market risk. Some observers have called it a credibility shock at the Fed, as if Wall Street has determined that central bankers are unwilling to make the hard decisions to bring pricing pressures down. 

Friday’s labor market reading and this week’s inflation report will color how investors — and most importantly, the bond market — see the Fed’s moves.

But the week closed with two news items that may bring back scrutiny over the Fed’s independence. First of all, the White House brought back its push to oust Fed governor Lisa Cook via a letter that said the president was “considering” her removal “Pursuant to the Supreme Court’s opinion from June 29, 2026.”

Second, a quip from White House National Economic Council Director Kevin Hassett, who said, “Kevin Warsh and the president have a very close, long-term relationship from New York City, from Florida, and they talk about the economy all the time.”

Typically, Fed presidents and US presidents do not talk all the time, and when they do, their agenda is released to the press by the central bank, a formality to preserve independence.

We’ll be watching how markets react to this — and just how much patience the bond market may have.

Economic and earnings calendar

Monday

Economic data: No notable economic data.

Earnings calendar: Simon Property Group (SPG), Barrick Mining Corporation (B), Rocket Lab Corporation (RKLB), AST SpaceMobile (ASTS)

Tuesday

Economic data: NFIB small business optimism, July (97.1 expected, 97.4 previously); ADP weekly employment change, week of July 25 (15,000 previously); Existing home sales, month-on-month, July (-0.7 expected, -2.4% previously)

Earnings calendar: Sea Limited (SE), Lumentum Holdings (LITE), Cardinal Health (CAH), CoreWeave (CRWV), Franco-Nevada Corporation (FNV), Venture Global (VG), InterContinental Hotels Group (IC1H.F), Super Micro Computer (SMCI), Tencent Music Entertainment Group (TME), Quantinuum (QNT), Aramark (ARMK), On Holding (ONON), Smithfield Foods (SFD), CAVA Group (CAVA), H&R Block (HRB), Firefly Aerospace (FLY)

Wednesday

Economic data: CPI, month-on-month, July (+0.2% expected, -0.4% previously); Core CPI, month-on-month, July (+0.2% expected, 0% previously); CPI, year-on-year, July (+3.4% expected, +3.5% previously); Core CPI, year-on-year, July (+2.5% expected, +2.6% previously); Real average hourly earnings, year-on-year, July (+0.1% previously); Real average weekly earnings, year-on-year, July (+0.3% previously); MBA mortgage applications, week ended July 25 (15,000 previously)

Earnings calendar: Cisco Systems (CSCO), Coherent Corp. (COHR), Nebius Group (NBIS), Cerebras Systems (CBRS), Amcor (AMCR), Pan American Silver Corp. (PAAS), Performance Food Group (PFGC), Korea Electric Power Corporation (KEP), Trimble (TRMB), Madison Square Garden Sports Corp. (MSGS), Fervo Energy (FRVO)

Thursday

Economic data: Initial jobless claims, week ended Aug. 8 (+199,000 previously); Continuing claims, week ended Aug. 1 (+1.801 million previously); PPI final demand, month-on-month, July (+0.2% expected, -0.3% previously); PPI ex food and energy, month-on-month, July (+0.3% expected, +0.2% previously); PPI final demand, year-on-year, July (+4.9% expected, +5.5% previously); PPI ex food and energy, year-on-year, July (+4.1% expected, +4.7% previously)

Earnings calendar: Applied Materials (AMAT), Brookfield Corporation (BN), Nu Holdings (NU), JD.com (JD), Tapestry (TPR), Dillard’s (DDS), Birkenstock Holding (BIRK)

Friday

Economic data: Retail sales advance, month-on-month, July (+0.3% expected, +0.2% previously); Retail sales ex auto, month-on-month, July (+0.2% expected, -0.2% previously); Business inventories, June (+0.3% previously); U. Mich. sentiment, August preliminary reading (54.1 expected, 55.2 previously); U. Mich. current conditions, August preliminary reading (55 expected, 54.8 previously); U. Mich. expectations, August preliminary reading (55 expected, 55.4 previously); U. Mich. 1-year inflation, August preliminary reading (+4.2% expected, +4.2% previously); U. Mich. 5-10 year inflation, August preliminary reading (+3.3% previously)

Earnings calendar: United States Antimony Corporation (UAMY)

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