Tech Surge: Apple’s $600 Billion Investment and Its Impact on the Market

Let's get to the big story breakdown.

While US stocks are set to open higher on this Monday.

Last week, Apple lifted the S&P 500 tech sector and the Nasdaq.

Well, the tech giant surged 13%, its best week since July 2020 after unveiling plans to spend $600 billion over four years in the US, and the move is seen as an effort to strengthen ties with President Trump, who has called.

More domestic investment from US companies.

Joining me as we kick off a new trading week is Peter Tuchman, senior floor trader at Trademoss.

Well, Peter, happy Monday.

Well, here we are, a new trading week underway, and we're about to see inflation figures, but what do you make of a lot of the movement we're seeing in tech right now, especially with Nvidia as well as AMD and Apple?

You know what, look, it's a matter of where, where people feel their return on investment is the quickest, right?

I mean, that's how we've been watching it and also it has a lot to do with, I think, how friendly an atmosphere it is within the administration and Nvidia, right?

We had that going back 6 weeks or so, you know, I mean, it's time is going by so quickly.

It's like you remember February, March, April was that period of the big sell off and then the tariffs and then there was that slow period and whatnot and we're suddenly here in the 2nd week of August.

We're already way into.

Sea and you know, and look, it's really clear that tech has been one of the leading sectors as far as earnings goes and with guidance, right?

However, we do have this sort of a push in a poll whether it's sort of a passive aggressive relationship between the White House and with Nvidia, right?

First they were outlawed from selling those chips, then they gave them the clear way and then Nvidia promised to put a lot of capex into the United States.

So it's going through, going the way of all tech, right?

And finally.

We saw that happen with Apple last week, right?

I mean, Apple's been one of the lagging tech companies that has not participated in a lot of the big rallies that we've seen AMD, Microsoft, record highs, record highs across the board, right, in earnings and in just in actual price action, right?

So you know, it's amazing.

I mean, it's it's where do they, where do we go from here?

You know, the bottom line is if we if we go to Dan Ives and I promise you all, we will get him here on the show is that there are trillions of dollars of capital. money on the sidelines that are being put to work and disseminated into the marketplace now with the endorsement of the White House and the administration, but also by the endorsement of Jensen, right, the, you know, the CEO of Nvidia.

So we're seeing big money.

Apple announced $600 billion expenditure in the US.

So you know, they are, they are giving money in their earnings have been good and so I think they are sort of standing out as a place where They're leading the market, you know, once again, and look, we know that they've been the one that's taking us higher for the last couple of years.

There was a little bit of a lull, but once again they're at the top.

Yeah, and this week we'll be paying attention to inflation figures.

Tomorrow morning we get consumer prices and on Thursday we get those PPI figures as well.

But of course we're all counting.

Down to September to see what the Fed does, but before that we get that annual gathering of Fed officials as well as bankers in Jackson Hole, Wyoming.

So what do you expect to see in those inflation figures and what could happen between now and the next Fed meeting?

Well, OK, so we know what ended up happening at the last Fed meeting, right?

We saw that.

First of all, it was on that Wednesday, right?

So GDP numbers came in.

We knew the probability was very slight that we were going to get a cut, and we did not.

I was hoping that we would have a really quick pivot because the numbers were calling for it.

One of the reasons that we have not cut for the last number of months is the fear by Jay Powell, who I think knows a little more of the economic cycles than the administration does that in a low growth or no growth environment.

Caused by tariffs, then you end up having stagflation if you cut rates.

Now we're setting the stage.

What ended up happening last week was that the that the inflation numbers and the bump up in the unemployment rate, right, and the readjustment of those numbers we're looking for 147.

We only came in at 47, then they readjusted and so that is showing us that that inflation that that.

OK, that they could OK, it's sort of complicated.

I'm trying to like make sense of it in my head it down.

Yeah, OK, well, so the bottom line is that the consumer we saw was Amazon.

Amazon came out with good earnings, but they are absorbing the cost of tariffs.

So what we're seeing is starting to see come out in the inflation numbers is the cost of and the price of tariffs, right?

For a while there we were not actually seeing the impact on the consumer, but in fact, now we're seeing it.

We're like in the second. stage, second stage of this sort of unraveling, not unraveling, but unfolding or evolve evolution of how tariffs are going to affect the consumer, what companies are absorbing the cost and what companies are passing on the cost.

The ones that are passing that on is obviously we're going to be all paying the higher price for that, and that's going to have an impact on inflation.

So we saw that in the jobs number, we saw that in the unemployment number bumping up.

We're seeing it in the cost, right, like in Amazon, a perfect example of that, that we are.

Paying higher prices for things, right?

And so that's that's a big factor and I think we're going to start to see inflation numbers reflect what the effect is of tariffs and that could be bigger than we thought.

Yeah, and Peter, you bring up an important point later on this week, we'll be getting retail sales as well and hard to believe, but it is almost back to school season, right?

We're counting down the days.

So what are you watching as we head into the final weeks of August and where do you see opportunity?

Well, that's a great question.

I mean, I think, you know, look, at the end of the day we lived through February, March, April.

We lived through that time where that was a self-inflicted sell off of the market more than 20%.

We were also fearful of the fact that there may be an interruption of the supply chain based on that. tariff scare, right, and that's something we had not seen going back to 2021 with JPMorgan and Jamie Dimon and and JPMorgan as a bank in earnings were not able to give guidance.

We had the same thing happen last earnings season.

OK, so what you're seeing is look.

I lost my train of thought.

Yeah, so what was your question? retail sales thank you thank you.

OK, so as we see this tariff situation unfold and evolve, we're going to see how it affects the consumer and that's a big thing, retail as these number, we have not really seen a full release.

The only thing that we've seen that showed the impact of tariffs is last week's unemployment numbers and so we're seeing how it's affecting the employment game and the job creation game.

Now we're going to start to see how it affects our.

People spending less, that's that retail number.

That's the PPI CPI, CPE number.

What is the actual effect and impact on the consumer?

And that's a big telling thing that's going to show us who's what companies are actually absorbing the cost and what are passing them on the consumer.

So this, there's a lot going on.

Jackson Hole will be very telling.

We know that cuts are coming.

I think the numbers that we're seeing set ourselves up.

This is once again where you and I have been.

Bad news is good news for cuts.

I think the bad news that's coming out, it's not bad.

It's not it's just a Little bit not as good as we thought it would be, but the impact of tariffs are real, and that's going to have an impact on whether we cut rates.

And if we cut rates at this time with this level of growth because GDP went up from 3.5% to 4%, 2.5 to 3%, I don't remember which one it was, that shows that we're setting the stage for cuts that are going to be responsive.

Yeah, that GDP number came in at 3%, at least the first reading, but you and I will be back here on Friday morning.

So thank you so much for sorry about that.

There's so much going on.

Thank you.

Break it down.