Pre-Markets Down Despite Strong Claims, Philly Fed

Thursday, August 20th, 2026

After yesterday’s announcement that the U.S. Treasury was adding liquidity to the long-term (30 year) bond market, we saw an immediate bump to pre-market indexes as bond yield rates dropped. In one day, that seems to have turned around: the 30-year bond is now back up to +5.25%, the 10-year at +4.71% and the 2-year +4.19%. Apply this to today’s pre-market indexes, and the results aren’t pretty: the Dow is down -440 points at this hour, the S&P 500 is -44 and the Nasdaq is -250 points.

Add to this higher spot oil prices both internationally (Brent crude is $94 per barrel [/bbl]) and domestically (WTI is $87/bbl) as the “economic D-day” is promised by the White House in its now six-month war with Iran. This helps push market futures lower with struggles in the global oil market appearing to continue. We don’t plant our seeds too deep in the soil regarding news items on the Strait of Hormuz, however; everything there is subject to change.
 

Weekly Jobless Claims Stay at Historic Lows

If you only read the labor market picture from Weekly Jobless Claims, you’d think we’d be having the most robust economy in a generation. Initial Claims came in below estimates at 206K, the lowest since registering 200K in the last week of July — and well off the 250K+ prints we’d seen sporadically in the past year or so, where we thought we might wind up by now. Continuing Claims ticked up to 1.799 million from an upwardly revised 1.781 million, also extremely low — we haven’t seen 1.8 million since the last week of June.

However, it seems worth pointing out that, depending on which state you live in, filing for unemployment immediately after finding yourself out of work may not make as much economic sense as picking up a gig driving for DoorDash DASH or Uber UBER. There are also a considerable amount of Baby Boomers retiring altogether from the workforce. And, as we’ve noted, we continue to be in a “low hire/low fire” labor market.
 

Philly Fed Highest Since Great Reopening: 47.4

After the Empire State manufacturing survey posted its highest level of the past year earlier this week, the Philly Fed manufacturing index cranked out its best performance in August since April of 2021 -- the foothills of the Great Reopening following the Covid pandemic. This follows July’s 41.4, which itself was the strongest print since November of 2021.

For some perspective, look where Philly Fed numbers were just a few years ago: nearly every month between June 2022 and February 2024 were negative. That has turned around in a big way, whether via data-center buildouts, the Chips Act, etc. We’re now up 11 of the past 14 quarters on Philadelphia-area business growth.
 

Earnings Results at a Glance: WMT, DE & More

Walmart WMT posted earnings of $0.81 per share versus expectations for $0.73, for an +11% positive surprise. The company also upped guidance, though rather conservatively. That said, year-over-year comps missed expectations, and shares are -7.5% on the news. Concerns regarding the shopping attitudes of its working-class base and a clear overvaluation (40x P/E) are helping prime the slide. For more on WMT’s earnings, click here.

Deere & Co. DE shares are up +1.4% in early trading, as its fiscal Q3 earnings posted a +6.5% beat: $5.10 per share versus $4.79 in the Zacks consensus. The company saw a big jump in its Construction segment (+84% — data-centers building equipment?) while also realizing $110 million in tariff refunds. For more on DE’s earnings, click here.

Advance Auto Parts AAP posted an impressive earnings beat of +27.2% this morning, but came up just shy on the revenues side and offered weaker guidance. Shares on a down morning like this are compounded: -18% at this hour. More evidence the consumer is tightening their collective belt? For more on AAP’s earnings, click here.

Meanwhile, Chinese stocks this morning have reported disappointing earnings. This goes for Alibaba BABA, NetEase NTES and Daqo Energy DQ, and all three stocks are selling off ahead of the opening bell.

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