Small-Caps Stay Higher, Other Indexes Dwindle

Tuesday, August 5, 2025

Market indexes started the trading day in the green, but had shown signs of choppiness early on. President Trump mentioned adding new tariffs on semiconductor imports, which helped move markets lower across the board. Only the small-cap Russell 2000 was able to recover, and closed up +0.59%. The Dow crept lower by -0.14%, the S&P 500 -0.49% and the tech-heavy Nasdaq was understandably lower, -0.65% for the session.
 

ISM Services Remain Above 50 — Barely

A mixed day for monthly services PMI posted after the markets opened this morning: S&P final Services PMI for July gained nearly 3 full points to 55.7 from an unrevised 52.9 the prior month. ISM Services, also out for the month of July this morning, made it to 50.1% — a full percentage point below expectations, and down from the previous month’s unrevised 50.8%.

Services make up roughly 70% of the U.S. economy, thus growth rests heavily on their shoulders. S&P and ISM Manufacturing reports out last week showed both still below that 50-level, so coming precariously close to that range on ISM Services is seen somewhat as a sign of weakness.
 

Big Afternoon for Q2 Earnings: AMD, SNAP, AMGN & More

Advanced Micro Devices AMD posted beats on both top and bottom lines in its Q2 report after today’s close. Earnings of 48 cents per share beat the Zacks consensus by a penny (though down significantly from 69 cents per share in the year-ago quarter) on $7.7 billion in revenues, which outpaced the $7.4 billion estimate and represents +32% growth year over year.

Revenue guidance was brought up to $8.7 billion from $8.1 billion previously projected by analysts. CEO Lisa Su considers the GPU chipmaker well-positioned for growth in the second half of the year, and we see the better-than-expected results from Q2 in Data Center and Client revenues. Gross Margins were +43% in the quarter, but expected to balloon up to +54% in Q3. 

Snapchat parent Snap SNAP posted a much weaker-than-expected bottom line result this afternoon: -$0.16 per share versus expectations for +$0.01 in the Zacks consensus, but we presume these are not comparable figures. Revenues came in-line with estimates at $1.34 billion. Shares are down -15% on the news, but SNAP has a history of volatility following an earnings release.

Biotech giant Amgen AMGN posted robust beats on both top and bottom lines, with earnings of $6.02 per share on $9.18 billion in revenues well ahead of the projected $5.26 per share and $8.87 billion, respectively. Full-year guidance was in-line on earnings and a tick higher on sales. Shares are giving back -1% from the +15% gains year to date.

Analog RF chipmaker Skyworks Solutions SWKS shares are up +9% in late trading on solid beats on both earnings and sales, with $1.33 per share coming in ahead of the $1.24 Zacks consensus on $965 million in revenues, beyond the estimated $939.5 million. Expectations for the present quarter are for $1 billion - $1.3 billion in revenues, and the company raised its dividend yield by +1%, for good measure.

SuperMicro SMCI, one of the biggest success stories on Wall Street back in early 2024, missed estimates by 3 cents per share to 41 cents, and came up -3% short on the top line to $5.76 billion. Guidance for next quarter is also down for both top and bottom lines, and shares are falling -14% in after-market trading.

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