Market Recap - Monday, August 18, 2025
Markets Stay Flat as Traders Await Fed Clarity
Stocks barely budged to start the week, with the S&P 500 and Dow each dipping 0.01% and 0.08%, while the Nasdaq rose just 0.03%. Small caps outperformed, with the Russell 2000 adding 0.35%, building on last week’s strong run. Most sectors drifted sideways, with a split between underperformers like industrial metals, housing-related names, and diners, and outperformers like managed care, cruise lines, and bank stocks. Big tech was mixed — Tesla rose, while Meta fell and Nvidia recovered after its winning streak snapped last week.
It was a low-volume day as traders waited for Fed Chair Jerome Powell’s Jackson Hole speech on Friday. Treasury yields rose slightly, the dollar strengthened, and oil climbed 1.2%. Gold slipped 0.1% and Bitcoin dipped another 0.6% after last week’s big losses.
What Moved the Market Today
Geopolitics Grab Headlines, But Not Markets: The Trump-Putin summit ended without a peace deal, though the tone was “constructive.” Trump has shifted to long-term peace talk framing, but no breakthroughs yet. Markets largely shrugged it off as no major sanctions or tariffs were announced, though chatter about tariffs on steel and chips is growing.
Fed Watch and Rates Outlook: With no Fed speakers today, all eyes are on Powell’s Jackson Hole speech Friday. Markets are still pricing in a ~85% chance of a 25bp rate cut in September, with most expecting just over 50bp in total cuts this year. Weekend comments from Fed’s Bostic pointed to consumer stress and tariff impact, reinforcing the one-and-done cut view for 2025.
Builder Confidence Slides: The August NAHB Housing Market Index unexpectedly slipped to 32, the lowest level in months. Rising rates, tighter regulation, and affordability challenges continue to drag down sentiment in the housing sector, though mortgage rates have recently eased slightly.
Earnings Highlights & M&A Buzz:
Big winners:
GDRX (+37%) jumped on news it’s partnering with Novo Nordisk to offer discounted Wegovy and Ozempic access.
DAY (+26%) soared on reports private equity firm Thoma Bravo is in talks to take it private.
DUOL (+12.9%), RUN (+11.4%), and EPAM (+4.4%) all rallied after analyst upgrades.
Losers:
Antero Resources (-5.7%) and Northern Oil & Gas (-2.1%) fell on weaker outlooks for natural gas and production volumes.
Intel (-3.7%) slipped despite reports the U.S. may take a 10% stake—possibly seen as government overreach.
Hims & Hers (-2%) dropped after losing out to GoodRx’s new drug deal.
Retail Earnings in Focus This Week: Names like Home Depot, Target, Walmart, and Ross all report this week, and investors are watching closely for tariff impacts, especially on lower-income consumers. Card data suggests summer spending improved, but retailers may start feeling pressure from rising costs and shifting consumer habits.
Here’s Our Take
Markets are in wait-and-see mode, holding steady after last week’s rally as the focus shifts to Fed policy signals from Jackson Hole. The lack of major geopolitical fallout and a quieter macro calendar are helping keep volatility low. But investor attention will sharpen midweek with Fed minutes, Powell’s speech, and retail earnings likely to set the next direction. The consumer remains resilient for now, but tariffs, inflation, and uneven economic data could still challenge the soft landing narrative. Until then, traders are staying cautious — but optimistic.
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