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🗞️ Amazon Eyes Same-Day Grocery
PLUS: Why Cisco stock is falling?
Market Performance
S&P 500: 6,466.58 (⬆️ 0.32% )
Nasdaq: 21,713.14 (⬆️ 0.14%)
Dow Jones: 44,922.27 (⬆️ 1.04%)
Amazon Continues to Expand
Amazon is escalating the grocery wars with a massive expansion of same-day fresh food delivery to over 1,000 U.S. cities, targeting 2,300 locations by year-end.
The service is free for Prime members on orders over $25, while non-members pay $12.99 regardless of order size.
The move is a strategic play to convert first-time grocery customers who return twice as often after trying fresh delivery.
Amazon's grocery retooling includes bringing Whole Foods closer to its main grocery umbrella under new leadership.
The market responded swiftly: grocery competitors got hammered with Instacart tumbling 11%, Kroger falling 4%, and Walmart dropping 2%.
Even DoorDash slipped 3% as investors recognize the threat to existing delivery models.
Our Takeaway
Amazon's grocery expansion represents a direct assault on traditional supermarket chains and delivery services.
With its massive logistics infrastructure and Prime ecosystem, Amazon is positioned to capture significant market share in the $800 billion U.S. grocery market.
This move could accelerate the shift toward online grocery shopping and pressure competitors to innovate or risk obsolescence.
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Market Overview
Markets surged to fresh records as rate cut optimism reached fever pitch following Tuesday's tamer-than-expected inflation report.
Traders are now pricing in a near 100% probability of a Fed rate cut in September, driving broad-based gains across equity markets.
The rotation favored smaller companies over mega-caps, with the Russell 2000 jumping 2% as investors positioned for lower borrowing costs.
Treasury Secretary Scott Bessent added fuel to the rally, suggesting the Fed could cut rates by at least 150 basis points starting with a 50-basis-point reduction in September.
Strong second-quarter earnings continue to support the fundamental backdrop, with companies demonstrating resilience despite macro headwinds.
The combination of easing monetary policy expectations and solid corporate performance has created a powerful tailwind for risk assets, pushing both the S&P 500 and Nasdaq to consecutive record closes.
Stock Moves Deciphered 📈
Palo Alto Networks (PANW) gained momentum after Deutsche Bank upgraded to buy with $220 price target, citing the pending $25 billion CyberArk acquisition as a growth catalyst.
Paramount Skydance continued its record-breaking rally with Goldman Sachs highlighting it in a screen of potential rotation beneficiaries as rate cut expectations build.
Capri Holdings (CPRI) jumped 8% after JPMorgan upgraded to overweight, forecasting multi-year revenue improvement driven by Michael Kors’ brand reinvigoration strategy and margin expansion.
Headlines You Can't Miss
AMD surged 5.4% leading tech gains, reaching levels not seen since July 2024.
Bullish crypto exchange priced IPO at $37 per share, above expected range, valuing company at $5.4 billion.
Hanesbrands agreed to be acquired by Gildan Activewear for $6 per share in a cash and stock deal worth $4.4 billion.
Warren Buffett dropped out of the top 10 wealthiest people globally as Berkshire Hathaway shares lagged since his retirement announcement.
Treasury Secretary Bessent called for Fed to cut rates by at least 150 basis points starting with 50bp in September.
Producer Price Index report on wholesale inflation due Thursday ahead of Jackson Hole Fed gathering.
Trending Stocks
Cisco (CSCO)
The networking giant pulled back 1% despite beating fourth-quarter expectations with adjusted earnings of $0.99 per share on $14.67 billion in revenue, versus analyst estimates of $0.98 and $14.62 billion.
Guidance barely surpassed expectations despite the stock being up 19% year-to-date. Management noted continued strength in enterprise networking demand but cautioned about macro headwinds.
CEO Quote🎤: “While we have some clarity on tariffs, we are still operating in a complex environment.”
Ibotta (IBTA)
The cashback platform crashed over 20% after missing second-quarter expectations with earnings of $0.08 per share versus $0.19 expected.
Revenue of $86 million fell short of the $90.5 million estimate, while third-quarter guidance came in weaker than anticipated.
The company cited increased competition in the digital rewards space, impacting user acquisition costs.
CEO Quote🎤: “Ibotta is working hard to bring the power of performance marketing to the CPG industry, allowing our clients to drive profitable revenue growth at scale.”
Coherent (COHR)
The semiconductor manufacturer plummeted 18% despite beating estimates with $1.00 per share earnings on $1.53 billion revenue, versus expectations of $0.91 per share and $1.51 billion, respectively.
Coherent announced the sale of its aerospace and defense business to Advent for $400 million, signaling a strategic focus on core semiconductor operations amid industry consolidation.
CEO Quote🎤: We delivered a strong fiscal 2025 with revenue growth of 23% and non-GAAP EPS expansion of 191%. We believe we are well positioned to continue to drive strong revenue and profit growth over the long-term given our exposure to key growth drivers such as AI datacenters.
What’s Next?
Key Earnings Today 👇
Applied Materials (AMAT): Q2 revenue forecast at $7.21 billion vs. $6.78 billion last year. Adjusted earnings are expected to grow from $2.12 per share to $2.36 per share.
Nu Holdings (NU): Q2 revenue forecast at $3.67 billion vs. $2.85 billion last year. Adjusted earnings are expected to grow from $0.12 per share to $0.14 per share.
Birkenstock (BIRK): Q2 revenue forecast at $636 million vs. $535 million last year. Adjusted earnings are expected to grow from $0.49 per share to $0.60 per share.
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Chart of the Day
Source: Visual Capitalist
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