[BRIEFING.COM] Stocks finished mostly higher on Wednesday, with the S&P 500 (+0.3%) and Nasdaq Composite (+0.5%) posting modest gains while the DJIA ended flat. Trading remained confined to relatively narrow ranges throughout the session as an in-line inflation report cleared the week's biggest macro hurdle without producing a major directional move.

The July Consumer Price Index matched expectations, with headline CPI increasing 0.1% and core CPI rising 0.2%. The lack of an upside surprise helped temper concerns about additional Fed tightening, with the CME FedWatch tool assigning a 61.9% probability to the FOMC leaving rates unchanged in September, up from 51.6% yesterday.

With the highly anticipated report offering little reason to alter the broader market outlook, attention quickly shifted back toward individual stocks and sectors. That was particularly evident in the information technology sector (+1.1%), which led the market as enthusiasm returned to semiconductor and AI-related names. The PHLX Semiconductor Index jumped 2.5%, with strong post-earnings reactions in CoreWeave (CRWV 107.73, +17.41, +19.28%), Super Micro Computer (SMCI 37.55, +5.95, +18.83%), and Lumentum (LITE 932.47, +111.88, +13.63%) reinforcing enthusiasm surrounding continued AI infrastructure spending.

Outside the information technology sector, SpaceX (SPCX 146.22, +12.93, +9.70%) was another momentum standout, surging after introducing Grok 4.6.

The real estate sector (+1.1%) matched information technology for the day's best performance amid some modest easing in Treasury yields.

Participation elsewhere was more mixed, however, with strength in semiconductor and AI-related names contrasting with weakness across several non-semiconductor mega-cap stocks. The consumer discretionary sector (-1.4%) finished at the bottom of the sector standings as Amazon (AMZN 267.28, -4.99, -1.83%) and Tesla (TSLA 327.51, -5.30, -1.59%) moved lower. Large apparel names also faced pressure, while homebuilders and related construction names struggled even as yields eased. The iShares U.S. Home Construction ETF fell 2.3%.

The communication services sector (-0.9%) was another laggard, with Meta Platforms (META 578.85, -20.27, -3.38%) among the weakest "Magnificent Seven" components. Charter Comm (CHTR 150.22, -7.47, -4.74%) also finished sharply lower despite little in the way of company-specific news.

Unlike the previous two sessions, geopolitical developments and oil prices had little influence on today's action. There were few meaningful developments surrounding the U.S.-Iran conflict, and WTI crude oil futures settled just $0.09 higher (+0.1%) at $83.26 per barrel. The energy sector (+0.2%) finished with a modest gain.

Overall, today's relatively uneventful session reflected a market that received some reassurance from the inflation data without a significant shift in the broader outlook. Reduced expectations for a September rate hike and renewed enthusiasm across semiconductor and AI-related stocks provided enough support to keep the S&P 500 and Nasdaq higher, even as mixed participation and weakness across several mega-cap names kept the advance contained.

U.S. Treasuries settled today's session mixed and little changed, surrendering a decent chunk of overnight gains in spite of a CPI report for July that was deemed market-friendly and a solid $42 billion 10-year note auction. The 2-year note yield settled down two basis points to 4.20%, and the 10-year note yield finished unchanged at 4.68%.

• Russell 2000: +22.7% YTD
• S&P Mid Cap 400: +18.0% YTD
• Nasdaq Composite: +14.4% YTD
• S&P 500: +13.2% YTD
• DJIA: +11.9% YTD

Reviewing today's data:

• Total CPI was up 0.1% month-over-month in July (Briefing.com consensus: 0.1%) following a 0.4% decline in June. That left the year-over-year rate at 3.4%, down from 3.5% in June. Core CPI, which excludes food and energy, was up 0.2% month-over-month (Briefing.com consensus: 0.2%) following an unchanged reading for June. On a year-over-year basis, core CPI was up 2.5% versus 2.6% in June.
  
  • The July CPI report, at the least, did not stoke "new" concerns that the Fed will have to raise rates at the September FOMC meeting. That is the key takeaway from the report, and it was embedded in the realization that this report came in as expected.
• The Treasury Department reported a $432.3 billion deficit for July versus a deficit of $291.1 billion for the same period in July 2025. Receipts totaled $334.0 billion, while outlays reached $766.3 billion.
  
  • The key takeaway from the report is that the net interest outlay exceeded the national defense outlay, which is saying something given that the U.S. is at war with Iran.

[BRIEFING.COM] The major averages are homing in on their first higher-across-the-board finish for the week, though the gains are modest in nature and keep them in negative week-to-date territory.

After the close, the market will receive another modest batch of earnings reports that includes some notable tech names.

Cisco (CSCO 123.98, +3.55, +2.95%) heads into its Q4 (Jul) report with momentum, trading near recent highs after an almost 9% gain since 7/24 and following a string of modest EPS beats with stronger revenue execution. The setup matters because management has leaned hard into an AI infrastructure and campus refresh narrative, so investors will want proof that order strength is converting into revenue while margins remain steady despite mix and memory headwinds.

Meanwhile, Cerebras Systems (CBRS 261.12, +26.36, +11.23%) is making a strong move ahead of its second earnings report as a public company tonight.

[BRIEFING.COM] The S&P 500 (+0.3%), Nasdaq Composite (+0.7%), and DJIA (+0.1%) remain little changed from previous levels as the market enters the final hour of a relatively muted midweek session.

Participation in the broader market is at its best levels of the session, with eight S&P 500 sectors in positive territory. However, the gains are largely modest in nature and have had little effect at the index level.

Stocks have enjoyed a session devoid of geopolitical or oil-driven swings, with crude oil futures settling today's session $0.09 higher (+0.1%) at $83.26 per barrel.

[BRIEFING.COM] The S&P 500 (+0.34%) is firmly in second place on Wednesday afternoon, up about 26 points.

The Treasury Budget for July showed a deficit of $432.3 billion compared to a deficit of $291.1 billion in the same period a year ago.

The July deficit resulted from outlays ($766.3 billion) exceeding receipts ($334.0 billion). The Treasury Budget data are not seasonally adjusted so the July deficit cannot be compared to the June deficit of $120.3 bln.

In short, the U.S. budget deficit surged +48% year over year in July, the largest monthly shortfall since March 2021, driven by rising Medicare costs and interest payments on the national debt. The fiscal-year deficit has now reached nearly $1.8 trillion, surpassing the comparable period in 2025.

[BRIEFING.COM] The Nasdaq Composite (+0.58%) is in first place on Wednesday afternoon, up about 153 points.

Gold futures settled $28.40 higher (+0.6%) at $4,469.50/oz, as softer-than-expected July inflation data reduces expectations for a September Fed rate hike, weighing on the dollar and boosting demand for gold. Ongoing U.S./Iran tensions and renewed ETF inflows are also supporting the metal as it approaches $4,500/oz.

Meanwhile, the U.S. Dollar Index is up about +0.2% to $100.01.

[BRIEFING.COM] The Dow Jones Industrial Average (+0.01%) is up less than 4 points, falling to third place among the major averages this afternoon.

A look inside the DJIA shows that NVIDIA (NVDA 223.96, +6.46, +2.97%), Caterpillar (CAT 865.96, +22.59, +2.68%), and Walmart (WMT 115.53, +2.27, +2.00%) hold some of the better gains today.

Meanwhile, Home Depot (HD 344.22, -10.26, -2.89%) is underperforming.

The DJIA is now -0.45% lower week-to-date.

Elsewhere, the 10-yr note auction saw the high yield of 4.683% pretty much stopping on the screws with the 4.682% when-issued yield. This was a decent auction with good dollar demand, evidenced by a 2.53 bid-to-cover ratio that exceeded the prior 12-auction average. There was solid demand from foreign buyers as well. The market's reaction to the auction results has been relatively muted. The front end continues to lead the back end of the curve in today's trading.

[BRIEFING.COM] Stocks hold a modestly positive bias in relatively uneventful trading, with the S&P 500 (+0.3%) and Nasdaq Composite (+0.7%) higher while the DJIA (+0.1%) sits closer to its flatline.

The major averages have spent much of the session moving within narrow ranges as investors digest this morning's inflation data. The July Consumer Price Index came and went without upsetting the market, as both headline (+0.1%) and core (+0.2%) CPI matched expectations. The report helped ease some concern about additional Fed tightening, pushing the probability of the FOMC leaving rates unchanged in September to 61.9% from 51.6% yesterday, according to the CME FedWatch tool. With the week's most anticipated economic release producing few surprises, trading has remained relatively stable.

The information technology sector (+1.1%) is providing some of the market's strongest leadership as momentum returns to semiconductor and AI-related names. The PHLX Semiconductor Index is up 3.2%, with sharp post-earnings gains in CoreWeave (CRWV 108.50, +18.18, +20.13%), Super Micro Computer (SMCI 36.64, +5.04, +15.97%), and Lumentum (LITE 937.26, +116.67, +14.22%) adding enthusiasm to the AI trade. That strength is helping offset weakness in software stocks and several mega-cap technology names.

Outside the information technology sector, SpaceX (SPCX 144.07, +10.78, +8.09%) is another momentum standout, jumping 7.2% after introducing Grok 4.6.

The real estate sector (+1.0%) is also a standout amid some modest easing in Treasury yields.

Strength elsewhere is more mixed, with six S&P 500 sectors currently trading higher and advancers holding only a slim advantage over decliners on both the NYSE and Nasdaq.

Meanwhile, weakness across non-semiconductor mega-cap stocks is limiting the upside at the index level. The consumer discretionary sector (-1.0%) is among the laggards as Amazon (AMZN 269.23, -3.04, -1.12%) and Tesla (TSLA 326.96, -5.85, -1.76%) move lower. NIKE (NKE 40.79, -0.53, -1.28%) and lululemon athletica (LULU 121.51, -4.10, -3.26%) are also under pressure, while homebuilders and related names have struggled despite the modest decline in yields. The iShares U.S. Home Construction ETF is down 1.9%.

The communication services sector (-1.0%) also trails the broader market, with Meta Platforms (META 582.62, -16.50, -2.75%) among the weakest "Magnificent Seven" components. Charter Comm (CHTR 150.03, -7.66, -4.86%) is another notable laggard despite little in the way of company-specific news.

Elsewhere, the energy sector is little changed as WTI crude trades just below its flatline amid relatively few new developments surrounding the U.S.-Iran conflict today.

Overall, the in-line CPI report has provided some reassurance on the policy front without generating a particularly forceful market reaction. Reduced expectations for a September rate hike and strength across semiconductor and AI-related stocks are supporting the major averages, though mixed breadth and weakness across several mega-cap names have kept the advance relatively contained.

Reviewing today's data:

• July CPI 0.1% vs. 0.1% Briefing.com consensus; prior -0.4%
• July Core CPI 0.2% vs. 0.2% Briefing.com consensus; prior 0.0%
  • The July CPI report, at the least, did not stoke "new" concerns that the Fed will have to raise rates at the September FOMC meeting. That is the key takeaway from the report, and it was embedded in the realization that this report came in as expected.

[BRIEFING.COM] The S&P 500 (+0.3%), Nasdaq Composite (+0.5%), and DJIA (+0.1%) are maintaining their modest gains just after midday.

CAVA Group (CAVA 68.43, +7.62, +12.53%) is surging today after reporting a better-than-feared Q2 report last night. The fast-casual Mediterranean chain beat EPS expectations, while revenue jumped 31.3% year-over-year to $368.4 million, also above expectations. CAVA also reaffirmed its FY26 guidance across key metrics and offered encouraging commentary around recent comp trends and consumer strength, helping ease concerns around a July slowdown tied to broader food-safety fears.

The positive results have been received well by similar fast-casual dining stocks, including Chipotle Mexican Grill (CMG 32.66, +0.66, +2.05%), which has plunged in recent weeks due to a Salmonella outbreak that prompted a jalapeo recall.

[BRIEFING.COM] The major averages remain little changed from previous values at midday.

However, the communication services sector (-1.2%) is charting session lows, with Meta Platforms (META 581.97, -17.15, -2.86%) a "Magnificent Seven" laggard amid a weak showing for non-semiconductor mega-cap stocks.

Charter Comm (CHTR 149.70, -8.00, -5.07%) is also one of the worst-performing S&P 500 names, despite a dearth of corporate news.

[BRIEFING.COM] The S&P 500 (+0.2%), Nasdaq Composite (+0.5%), and DJIA (flat) are mostly higher just after midday amid another relatively quiet session for stocks this week.

Coming into the session, this morning's release of the July Consumer Price Index was touted as the most important market event this week. Both Headline (0.1%) and Core (0.2%) CPI were in line with expectations, which increased the market's expectations that the Fed will keep rates on hold at the September FOMC meeting and set the market up for what has been a relatively stable day of trading so far. The CME FedWatch tool now assigns a 59.6% probability to the Fed keeping rates steady at the next meeting, up from 51.6% yesterday.

The information technology sector (+1.1%) paces the gains, with some enthusiasm returning to the momentum trade following the earnings of CoreWeave (CRWV 106.23, +15.91, +17.62%), Super Micro Computer (SMCI 35.82, +4.22, +13.37%), and Lumentum (LITE 932.69, +112.10, +13.66%). The PHLX Semiconductor Index is up 3.0%, which is offsetting some weakness in software names and mega-cap tech stocks outside the sector.

Strength in the broader market is mixed, with a total of six S&P 500 sectors trading higher and advancers outpacing decliners by a slim margin on both the NYSE and Nasdaq.

[BRIEFING.COM] The major averages remain mostly higher, though strength in the broader market has deteriorated since the open, leaving just three S&P 500 sectors in positive territory.

Meanwhile, the consumer discretionary sector (-1.3%) is firmly lower, with Amazon (AMZN 269.23, -3.04, -1.12%) and Tesla (TSLA 324.49, -8.32, -2.50%) providing weak leadership. Large apparel names such as NIKE (NKE 40.73, -0.59, -1.43%) and lululemon athletica (LULU 122.19, -3.42, -2.72%) hold similar losses, while homebuilder and related construction-related names such as Home Depot (HD 344.22, -10.26, -2.89%) move lower despite modest easing in oil prices and Treasury yields today. The iShares U.S. Home Construction ETF is down 2.6%.

[BRIEFING.COM] The S&P 500 (+0.3%), Nasdaq Composite (+0.7%), and DJIA (+0.1%) trade in a relatively stable range so far this morning.

Tech continues to pace the gains, with Super Micro Computer (SMCI 35.86, +4.26, +13.48%) moving sharply higher after reporting Q4 (Jun) results that were largely in line with its guidance from July, while the company's outlook for Q1 (Sep) and FY27 came in well above expectations. SMCI said demand for its AI/IT solutions is stronger than ever as it continues to transform from a US-based server manufacturer into a leading AI/IT data center total-solution provider. The company is increasingly positioning itself as a one-stop shop for customers looking to build data centers and AI factories faster and more efficiently. With Q4 results generally in-line with prior guidance, the primary catalyst for today's move is the impressive guidance.

[BRIEFING.COM] The S&P 500 (+0.3%), Nasdaq Composite (+0.6%), and DJIA (flat) are mostly higher this morning, with tech stocks leading the way after a modest but solid round of earnings reports and an in-line July Consumer Price Index.

The information technology sector is up 1.2%, with Super Micro Computer (SMCI 35.95, +4.35, +13.77%) leading all S&P 500 names while memory and other semiconductors also outperform. The PHLX Semiconductor Index is up 2.9%, offsetting some weakness across software stocks such as Microsoft (MSFT 492.82, -10.99, -2.18%) and Salesforce (CRM 192.56, -4.91, -2.49%), which weigh on the DJIA.

Gains are more modest elsewhere, with the utilities (+0.6%), real estate (+0.5%), and industrials (+0.4%) sectors among the early risers.

Meanwhile, mega-cap stocks outside the information technology sector continue to lag, weighing on the consumer discretionary (-0.9%) and communication services (-0.6%) sectors.

Equity futures point to a higher open after the release of the July Consumer Price Index. 

Total CPI was up 0.1% month-over-month (Briefing.com consensus: 0.1%) following a 0.4% decline in June. That left the year-over-year rate at 3.4%, down from 3.5% in June. Core CPI, which excludes food and energy, was up 0.2% month-over-month (Briefing.com consensus: 0.2%) following an unchanged reading for June. On a year-over-year basis, core CPI was up 2.5% versus 2.6% in June.

The July CPI report, at the least, did not stoke new concerns that the Fed will have to raise rates at the September FOMC meeting. That is the key takeaway from the report, and it was embedded in the realization that this report came in as expected.

The S&P 500 futures currently trade 28 points above fair value. 

Equity indices in the Asia-Pacific region were mixed on Wednesday, with South Korea's Kospi (+3.7%) the standout thanks to leadership from its semiconductor components and the positive AI vibes flowing from CoreWeave's earnings results. There was also a report from Asia Business Daily that Temasek, Singapore's sovereign wealth fund, is looking at investing in Samsung and SK Hynix. A contention by Bank of Korea's Deputy Governor Sangdai that there will likely be more rate hikes due to persistent core inflation and strong economic growth did not upset the Kospi's bullish bias. USD/JPY -0.1% to 159.16, with the yen weakening from a post-intervention high of 155.23 seen on August 3. 

In economic data:

• Japan's August Reuters Tankan Index 18 (prior 13)
• South Korea's July Unemployment Rate 2.8% (prior 2.7%)
• India's July CPI 4.45% yr/yr (4.50% expected; prior 4.38%)

---Equity Markets---

• Japan's Nikkei: +0.8%
• Hong Kong's Hang Seng: -0.8%
• China's Shanghai Composite: +0.3%
• India's Sensex: -0.2%
• South Korea's Kospi: +3.7%
• Australia's All Ordinaries: -0.4%

Major European indices are mostly higher. Germany's CPI held at 2.8% yr/yr with the final July report, while Italy's CPI ticked up slightly to 2.9% from the preliminary report of 2.8%, leaving them well ahead of the ECB's 2% inflation target. Markets are also keeping tabs on Brent crude prices, which have moved from roughly $80.00/bbl at the start of the month to $89.04/bbl today as the U.S. and Iran dig in with their respective demands for getting to a peace agreement and full reopening of the Strait of Hormuz.

In economic data:

• Germany's July CPI 0.8% m/m (expected 0.8%; prior -0.3%) and 2.8% yr/yr (expected 2.8%; prior 2.3%). June Current Account Balance EUR19.0 bln (prior EUR9.0 bln).
• Italy's July CPI 0.3% m/m (expected 0.2%; prior 0.0%) and 2.9% yr/yr (expected 2.8%; prior 3.0%)

---Equity Markets---

• STOXX Europe 600: +0.1%
• Germany's DAX: +0.3%
• U.K.'s FTSE 100: -0.1%
• France's CAC 40: -0.1%
• Italy's FTSE MIB: +0.3%
• Spain's IBEX 35: +0.2%

The S&P 500 futures now trade 20 points above fair value immediately following the release of the July Consumer Price Index.

Total CPI increased 0.1% (Briefing.com consensus 0.1%) month-over-month in July following a 0.4% decrease in June.

Core CPI, which excludes food and energy increased 0.2% (Briefing common consensus 0.2%) after an unchanged reading in June

Equity futures point to a higher open this morning, with futures linked to the Nasdaq leading the advance as tech names move higher in the premarket following the latest batch of earnings reports. Outside of a few notable earnings moves, corporate news flow is once again on the lighter side this morning. Oil is modestly higher after yesterday's bump as investors still await a material change to the state of negotiations between the U.S. and Iran.

The relative calm across headlines this morning puts the market's focus squarely on the 8:30 a.m. release of the July Consumer Price Index, which is expected to be the biggest catalyst of the week. Headline CPI is expected to increase 0.1% month-over-month, with Core CPI expected to tick up 0.2%. The release is especially important as expectations for a rate hike at the September FOMC meeting have slipped over the past month, with the market's implied odds now slightly favoring the Fed keeping rates steady.

In corporate news:

• CAVA Group (CAVA 70.65, +9.84, +16.2%) beat EPS and revenue expectations.
• CoreWeave (CRWV 106.54, +16.22, +18.0%) missed EPS expectations, reported revenues in-line, and guided Q3 revenue and FY26 revenue expectations.
• Super Micro Computer (SMCI 34.31, +2.71, +8.6%) beat EPS expectations, reported revenues in-line, and guided SepQ EPS and FY27 revenues well above consensus.

Reviewing overnight developments: 

Equity indices in the Asia-Pacific region were mixed on Wednesday, with South Korea's Kospi (+3.7%) the standout thanks to leadership from its semiconductor components and the positive AI vibes flowing from CoreWeave's earnings results. Japan's Nikkei: +0.8%, Hong Kong's Hang Seng: -0.8%, China's Shanghai Composite: +0.3%, India's Sensex: -0.2%, South Korea's Kospi: +3.7%, Australia's All Ordinaries: -0.4%.

In news:

• There was a report from Asia Business Daily that Temasek, Singapore's sovereign wealth fund, is looking at investing in Samsung and SK Hynix.
• A contention by Bank of Korea's Deputy Governor Sangdai that there will likely be more rate hikes due to persistent core inflation and strong economic growth did not upset the Kospi's bullish bias.
• USD/JPY -0.1% to 159.16, with the yen weakening from a post-intervention high of 155.23 seen on August 3.

In economic data:

• Japan's August Reuters Tankan Index 18 (prior 13)
• South Korea's July Unemployment Rate 2.8% (prior 2.7%)
• India's July CPI 4.45% yr/yr (4.50% expected; prior 4.38%)

Major European indices are mostly higher, sporting modest gains in front of the 8:30 a.m. ET release of the U.S. July CPI report. STOXX Europe 600: +0.1%, Germany's DAX: +0.5%, U.K.'s FTSE 100: +0.1%, France's CAC 40: -0.1%, Italy's FTSE MIB: +0.3%, Spain's IBEX 35: +0.2%.

In news:

• Germany's CPI held at 2.8% yr/yr with the final July report, while Italy's CPI ticked up slightly to 2.9% from the preliminary report of 2.8%, leaving them well ahead of the ECB's 2% inflation target.
• Markets are also keeping tabs on Brent crude prices, which have moved from roughly $80.00/bbl at the start of the month to $89.04/bbl today as the U.S. and Iran dig in with their respective demands for getting to a peace agreement and full reopening of the Strait of Hormuz.

In economic data:

• Germany's July CPI 0.8% m/m (expected 0.8%; prior -0.3%) and 2.8% yr/yr (expected 2.8%; prior 2.3%). June Current Account Balance EUR19.0 bln (prior EUR9.0 bln).
• Italy's July CPI 0.3% m/m (expected 0.2%; prior 0.0%) and 2.9% yr/yr (expected 2.8%; prior 3.0%)

[BRIEFING.COM] The S&P 500 (-0.3%), Nasdaq Composite (-0.6%), and DJIA (-0.3%) finished lower today as the major averages steadily faded from another quiet start amid rising oil prices and weakness across most mega-cap technology stocks.

A relatively light corporate news flow and some caution ahead of tomorrow's July Consumer Price Index (Briefing.com consensus 0.1%) kept the major averages near their flatlines through the first two hours of trading. Crude oil initially retreated from its overnight highs after Bloomberg reported that Pakistan's Defense Minister Khawaja Asif said the U.S. and Iran were close to "some sort of an arrangement." The tone shifted later in the morning, however, as reports reiterated that Iran's demands must be met before it will agree to reopen the Strait of Hormuz.

Stocks began to move lower as oil prices climbed, with WTI crude oil futures ultimately settling $1.00 higher (+1.2%) at $83.17 per barrel. The energy sector (+1.1%) was one of the best-performing S&P 500 sectors as a result.

While there were pockets of weakness throughout the broader market, losses were more pronounced across mega-cap technology names, with the Vanguard Mega Cap Growth ETF retreating 0.7%. The communication services sector (-2.1%) finished as the worst-performing S&P 500 sector as Alphabet (GOOG 343.00, -12.84, -3.61%) was a particular laggard, while weakness in Amazon (AMZN 272.27, -5.82, -2.09%) weighed on the consumer discretionary sector (-0.8%).

Within the information technology sector (-0.3%), software names such as Oracle (ORCL 145.44, -5.60, -3.71%) and AppLovin (APP 318.68, -20.32, -5.99%) added pressure following yesterday's rally.

Semiconductor stocks were a relative bright spot, though the PHLX Semiconductor Index (+0.9%) finished well off its earlier highs. NVIDIA (NVDA 217.48, -0.07, -0.03%) gave back the entirety of a strong opening gain that followed yesterday's late selloff on news of its initiative with several major asset managers to mobilize up to $500 billion for AI compute infrastructure. KKR (KKR 111.02, +7.18, +6.92%) and Apollo Global Management (APO 140.24, +8.22, +6.23%) both participants in the initiative, were among the day's best-performing S&P 500 components.

Elsewhere, the industrials sector (+0.6%) followed the semiconductor group higher, with the usual collection of electrical equipment names outperforming, while Axon (AXON 636.31, +39.98, +6.70%) was an S&P 500 standout as it recovered some of its sharp post-earnings slide from last week.

The defensive utilities sector (+1.1%) tied the energy sector for the day's top performance amid the weakness in mega-cap technology stocks.

While eight S&P 500 sectors finished lower, the market displayed some resilience beneath the surface. The S&P 500 Equal Weight Index (+0.3%) finished higher, and advancers still outpaced decliners on both the NYSE and Nasdaq. Additionally, the Russell 2000 (+0.3%) and S&P MidCap 400 (+0.3%) outperformed the major averages.

Still, below-average trading volume and the pullback across mega-cap stocks pointed to some caution ahead of tomorrow's July CPI release (Briefing.com consensus 0.1%). The inflation reading could play a decisive role in shaping the Fed's next policy move, as the CME FedWatch tool currently assigns equal odds to a rate hike or a hold at the September FOMC meeting.

U.S. Treasuries recorded modest gains on Tuesday, inching higher ahead of the highly anticipated Wednesday morning release of July CPI. The U.S. Treasury started this week's note and bond auction slate with a strong $58 billion 3-year note offering, though Treasuries held at their pre-auction levels into the close. The 2-year note yield settled down two basis points to 4.22%, and the 10-year note yield settle down two basis points to 4.68%. 

• Russell 2000: +22.0% YTD
• S&P Mid Cap 400: +17.5% YTD
• Nasdaq Composite: +13.8% YTD
• S&P 500: +12.9% YTD
• DJIA: +11.9% YTD

Reviewing today's data:

• July NFIB Small Business Optimism 99.8 (Briefing.com consensus 97.1); Prior 97.4
• July Existing Home Sales 4.06 mln (Briefing.com consensus 4.07 mln); Prior was revised to 4.13 mln from 4.09 mln
  • The key takeaway from the report is that mortgage rates above 6.00%, limited inventory, and elevated prices continue to work against stronger existing home sales activity.