Nasdaq 100 +0.43%
S&P 500 +0.49%
My portfolio + 2.82%
Market pulse
The week was essentially a contest between exceptionally strong AI-related earnings and renewed interest-rate risk. Nvidia and the broader software earnings wave demonstrated that AI investment was continuing to translate into rapid revenue growth. At the same time, sticky inflation and Warsh’s refusal to soften the Fed’s 2% objective prevented a more sustained re-rating of equities. The major indices finished slightly higher because the earnings evidence was strong enough to offset—but not eliminate—the monetary and geopolitical headwinds.
Crowd vs. Price
Investor positioning was considerably more cautious than the index performance suggested. Investors withdrew $22.33 billion from U.S. equity funds during the week ending 26 August, the largest weekly outflow since March. Large-cap funds alone lost $24.73 billion. At the same time, mid-cap funds received $2.24 billion and small-cap funds $794 million, suggesting that the selling was concentrated in crowded large-cap exposure rather than representing an indiscriminate abandonment of American equities. Technology funds still attracted $1.81 billion, while bond funds received $7.12 billion for their nineteenth consecutive week of inflows.
That produced a notable divergence:
The crowd reduced broad large-cap exposure.
The indices nevertheless rose.
Investors continued buying targeted technology exposure.
The clean reading is that investors were not buying “risk” indiscriminately. They were willing to pay for visible earnings growth, recurring revenue and credible AI monetisation, while continuing to punish regulatory, competitive and execution risk. The indices looked calm because their largest companies absorbed most of the positive capital flows; the underlying market was substantially more selective.
Holdings & Watchlist Notes
SSAB B: +7.02%
SSAB B was the portfolio’s strongest performer, rising 7.02%, principally because the breakdown of U.S.–Canada trade negotiations preserved the tariff protection enjoyed by SSAB’s American operations. The news reversed much of the previous week’s selloff, which had been driven by expectations of lower U.S. tariffs on Canadian steel. The rally received additional support later in the week from upward revisions to analyst earnings estimates and target prices, while firm prices and low inventories in the North American heavy-plate market strengthened the underlying case. The move should nevertheless be interpreted mainly as a repricing of U.S. trade protection rather than a general recovery in European steel demand.