Early August Rally Brings Record Closing Highs

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If “Sell in May and Go Away” isn’t already a dead notion, this early trading week is killing it. The Dow (DIA) has closed at a new record high, +912 points, +1.72%, to 54,085. The S&P 500 (SPY) likewise closed at fresh highs: +135 points, +1.78%, to 7736. The Nasdaq (QQQ) was still short of its June all-time closing highs, but gained +668 points, +2.58%. The small-cap Russell 2000 (IWM) climbed +55 points, +1.85%.

It’s safe to say near-term fears have been assuaged regarding both the AI profitability panning out in Q2 numbers and the latest suggestion that an agreement with Iran may re-open the Strait of Hormuz once again. Keep in mind trading volatility has picked up this summer, and good news today might give way to less-good news tomorrow. Afternoon earnings reports have thus far proven that what goes up must come down, at least when it comes to a couple of the higher-profile names reporting after the close.

Q2 Earnings Roundup: SPCX, AMD, BKNG

The first quarter earnings report for Space Exploration Technologies Corp., aka SpaceX (SPCX - Free Report), easily outperformed expectations: a bottom-line loss of -$0.09 per share bettered the -$0.26 Zacks consensus estimate, while revenues of $7.8 billion improved from the $6.72 billion projected. Both its Space (rockets) segment and Connectivity (Starlink) segments surpassed estimates, with Starlink subscriptions growing +20% quarter over quarter to 12 million.

That said, shares are down in late trading by roughly -5% after a gain of more than +9% in today’s regular session. Capital expenditures more than doubled quarter over quarter: from $7.7 billion in Q1 to $15.83 billion in today’s report. Once the SpaceX conference call begins, we might expect some more movement in these shares, based on what CEO Elon Musk has to say about the quarter and SpaceX’s forecast.

Advanced Micro Devices (AMD - Free Report) gave back its +7% gains from today’s trading day following its Q2 beat on both top and bottom lines. Earnings of $1.66 per share beat estimates by a solid nickel, while revenues of $11.5 billion easily surpassed the $11.32 billion estimate, for +50% growth year over year. Data Center revenue did outperform projections, but “only” to where the “whisper number” had been hovering.

Further, Gross Margins posted a narrow improvement over expectations, but for a stock up +142% year to date (AMD was a late-bloomer in the AI-trade bonanza), mild outperformance actually leads investors toward booking profits. AMD as a company appears to be hitting all its marks, but in an earnings season that has seen some real blowout numbers so far, AMD’s Q2 is a bit of a yawner.

Speaking of “booking,” Booking.com (BKNG - Free Report) also posted earnings and revenue beats in its Q2 this afternoon. Earnings of $2.54 per share outshone the $2.45 in the Zacks consensus, with revenues of $7.4 billion above the $7.19 billion projected. Gross Bookings surged ahead to $51 billion in the quarter, with Room Nights coming in at 325 million from 320 million expected. Shares are jumping +5.7% in the after-market, but are still down roughly -4% year to date.