Sandisk is up 5.7% and Western Digital gained 1.4%. The memory side is holding while the broader semiconductor group gets hit. That is a narrow market choosing pieces of the supply chain, not a clean technology exit.
Breadth backs that up. Advancing issues are outnumbering decliners 1.13-to-1 on both exchanges. The S&P 500 posted 12 new 52-week highs against one new low. The Nasdaq recorded 68 new highs and 47 new lows. The selling is concentrated in the biggest names, not spread across the index.
Retail Sales and Consumer Sentiment Raise a Growth Question the Market Did Not Have Thursday
July retail sales fell unexpectedly after rising 0.2% in June. The University of Michigan’s preliminary consumer-sentiment reading came in at 51 against a 54.5 estimate. Neither number is a crisis. Both tell you the consumer is not as strong as the record close implied.
The inflation reports earlier this week made a September hold more likely. Friday’s data adds a growth problem to the same conversation. The market wanted softer inflation to give the Fed room to stand pat. It got softer inflation and a weaker consumer on the same week, and now it has to price both at the same time.
Hormuz Is Getting Worse and Energy Is the Only Sector in the Green
The S&P 500 energy sector is up 1.5%. The United States said it could maintain a naval blockade of Iran indefinitely. Two more vessels were attacked near the strait. Traffic is approaching a standstill.
The CPI and PPI reports this week came in contained partly because gasoline prices fell in July and the late-month oil surge had not yet reached the data. Friday’s developments put the focus on the next round of inflation readings instead. Energy stocks are rising because the market is pricing a longer disruption. Technology stocks are falling because the same disruption threatens the lower-rate environment that carried the Nasdaq to Thursday’s high.
Reddit Holds Its S&P 500 Inclusion Gain
Reddit is up more than 12% after being named as a new S&P 500 addition effective August 18. The inclusion brings passive-fund demand into the stock and traders are front-running the rebalance. The move is doing exactly what an index-addition trade is supposed to do. It is not carrying the broader market because Friday’s story is chips, the consumer and oil.
Stocks in the News
Workday fell after reports that Silver Lake is in talks to acquire the software company. Red Cat and Unusual Machines surged after President Trump said the United States would impose tariffs on drone imports and components.
What to Watch
Thursday’s record did not produce follow-through. Broadcom and Applied Materials are pulling technology lower. Retail sales and consumer sentiment are raising growth questions. Oil is climbing as Hormuz traffic deteriorates. The bulls still have strong second-quarter earnings with growth tracking around 50% and a Fed that looks less likely to hike after this week’s inflation data. The bears have a weaker consumer and crude that can rebuild the inflation argument before the next round of data lands.
The S&P 500 is posting an inside move below Thursday’s record. The Nasdaq failed to take out yesterday’s high and selling is accelerating into the close. A trade through the minor trend levels shifts momentum to the downside. The close tells you whether the record was a level buyers want to defend or the point where they decided to take profits heading into the weekend.
