Daily Macro Brief
AI demand holds up while long yields stay above 5%
NVIDIA's results and AWS expansion plan confirm strong AI infrastructure demand, but long yields, global central banks, and trade friction still limit the broader risk rally.
This report is based on intraday data as of 11:31 AM ET and does not reflect closing prices. Markets may have moved since publication.
Revisiting yesterday’s view
Yesterday’s brief identified NVDA earnings as the next test for the AI hardware chain. Results and the next-quarter outlook exceeded public expectations, while AWS extended the GPU expansion story several years into the future. Semiconductors rallied, but infrastructure and memory names did not rise in unison, and the 30-year Treasury yield remained at 5.18%. The results confirmed demand, but not yet its breadth.
Today’s core view
AI capital spending remains the clearest growth engine for US risk assets, but today’s evidence supports one powerful theme rather than a fresh acceleration across the economy. Imports and inventories are rising, long-term financing costs remain high, and central banks in Asia and Europe are not moving toward synchronized easing. Investors can reward stronger AI revenue while still demanding compensation for trade costs, term premium, and energy transport risk.
The news that matters today
NVIDIA and AWS extend the AI demand horizon
NVIDIA’s latest quarterly revenue and adjusted profit exceeded market expectations. Its next-quarter revenue outlook also came in above public consensus without assuming data-center compute revenue from China. AWS then announced a large additional deployment of NVIDIA GPUs across its global infrastructure, including secure AI systems for the US government.
Together, the releases move the evidence beyond one strong earnings report and into a customer’s deployment schedule. NVIDIA also disclosed a sharp increase in supply commitments, primarily for memory procurement, which points to preparation over a longer cycle. The next test is whether server, networking, memory, and power suppliers report the same improvement. If NVIDIA remains the only consistent source of upside, the market will treat today’s confirmation as a company-specific advantage.
US employment remains steady as trade and inventory pressure builds
The latest unemployment insurance report showed no sudden deterioration in layoffs, and the number of people receiving continuing benefits declined. At the same time, the US goods trade deficit widened sharply as exports fell and imports rose. Wholesale and retail inventories also increased.
Capital goods drove much of the import growth, so the release is not a simple sign of weaker final demand. Yet companies that import early and build inventory before tariff policy settles may squeeze future margins and pull activity forward from later quarters. If inventory-to-sales ratios rise and capital-goods imports fail to turn into equipment spending, this increase will look more like preloaded costs. If business investment follows, domestic demand still has room to run.
Hormuz negotiations remain unfinished, and a Russian refinery has stopped processing
Iran and Oman are still negotiating details of an interim Hormuz arrangement, while Qatar is promoting a joint shipping lane and mine-clearing effort. No final agreement exists. A new official warning confirmed that an unidentified projectile struck a tanker near Oman, allied sources say mine risk remains, and Russia’s NORSI refinery stopped processing crude after a drone attack.
The diplomatic activity improves the chance of de-escalation, but physical flows and refinery operations have not shown the same progress. Visible vessel traffic remains far below its prewar norm, and ships that turn off transponders make the count less reliable. A lower supply-risk premium needs firmer evidence: an operating interim lane, better insurance terms, several days of higher traffic, and a restart at NORSI.
Global central banks are still guarding against higher inflation
The Bank of Korea raised rates again and increased its growth forecast. Bank of Japan Deputy Governor Ryozo Himino argued explicitly for further policy-rate increases. Minutes from the European Central Bank said its pause did not necessarily mark the end of tightening.
These institutions face different domestic conditions, but none is ready to declare the inflation problem solved. That limits the scope for a synchronized global bond rally and prevents lower US rates from automatically producing cheaper financing everywhere else. Their bias will soften only if wages, service prices, and currency pressure ease together. Until then, Japan’s front end and European financing costs can still move higher.
Canada’s external account improves as trade friction intensifies
Canada’s latest quarterly current account moved into surplus, led by energy exports. Almost simultaneously, US Trade Representative Jamieson Greer warned Canada against further retaliation and suggested considering bans on some Canadian goods. Washington has not issued a formal ban or a revised tariff schedule.
Energy exports give Canada a larger external buffer, but they do not remove the policy uncertainty facing cross-border manufacturers. Companies still do not know whether the US threat will become a product list or whether negotiations can stop Canada’s measures before implementation. Formal notices, exemptions, and customs instructions remain the factual threshold for judging the next North American cost shock.
The weak point in today’s view is that the rally remains concentrated in a small group of semiconductor names. Server, memory, and power suppliers did not respond across the board. Slower NVIDIA demand, delays to the AWS deployment, or continued divergence in supplier results would weaken the AI confirmation. The opposite outcome could also overturn the constraint side of the thesis: a decisive fall in long yields, no implemented trade measures, and broad transmission of AI orders would give the risk rally much more room.
Bond market interpretation
The 30-year Treasury yield remains above 5%, while the 2-year JGB has an RSI of 88.10. Those threshold breaks warrant a table. The comparison uses the 11:31 AM ET snapshot and yesterday’s intraday brief:
| Market | Maturity | 11:31 AM ET | Change from yesterday’s snapshot |
|---|---|---|---|
| US Treasury | 2-year | 4.17% | about -7bp |
| US Treasury | 10-year | 4.66% | about +1bp |
| US Treasury | 30-year | 5.18% | about 0bp |
| JGB | 2-year | 1.697% | about +1.3bp |
| JGB | 10-year | 2.892% | about -0.5bp |
| JGB | 30-year | 4.039% | about -0.1bp |
The US curve steepened as the front end fell and the long end barely moved. Jobless claims were still low, so today’s data alone do not explain the decline in the 2-year yield. A safer reading is that rates markets allow some future policy relief but continue to demand compensation for long-term inflation and fiscal risk. Wednesday’s 5-year auction stopped at 4.393% with a 2.37 bid-to-cover ratio. Demand absorbed the supply, but it did not dislodge the 30-year yield from above 5%. This afternoon’s 7-year auction will test whether demand is stronger farther out the curve.
Japan’s curve moved little, yet the 2-year yield remains technically extreme. Himino’s call for timely increases, coupled with the Bank of Korea’s action, puts more direct pressure on Asian front-end rates. US short yields falling as Japanese short yields rise is a reminder that global financing conditions are diverging, not easing together.
Sector and price response
The tape is Risk-On, but gains are concentrated. VOO rose 0.5% intraday, QQQ gained 1.0%, and SMH advanced 2.3%, while VIX fell 5.0% to 14.45. The dollar index was nearly flat, TLT slipped 0.1%, and crude oil and gold barely moved. Better risk appetite came from AI earnings rather than a joint improvement in rates, commodities, and global growth.
AI semiconductors and infrastructure
NVDA rose 7.49% intraday and pulled SMH up 2.3%. AVGO, INTC, and TSM also posted clear gains. The response was uneven: AMD fell 1.20%, MU lost 2.44%, VRT rose just 0.07%, and DELL added 0.67%. Earnings confirmed demand at the accelerator layer, and AWS extended visibility through a long deployment plan, but servers, memory, and power have yet to provide equally strong price confirmation. AVGO’s RSI remains just 20.8, so part of its gain also reflects a rebound from a deeply stretched level. The theme becomes an industry-wide confirmation only if orders, deliveries, and margins improve across more suppliers.
Energy and shipping
Crude oil traded at $82.21 intraday, nearly unchanged on the day and still down 6.4% over five days. XOM, CVX, and OXY all lagged the broad market despite unfinished Hormuz negotiations, an officially confirmed tanker strike, and the shutdown of crude processing at NORSI. The EIA natural-gas injection came in below consensus, but total inventories remain above the five-year average, so that report does not by itself prove oil scarcity. The market continues to give greater weight to demand, alternative supply, or adaptation in shipping routes. Public data cannot yet separate those explanations. If vessel traffic stays depressed while Russian fuel exports or US product inventories tighten, the energy market’s calm response will be harder to defend.
Digital assets
BTC rose 1.8% intraday to about $80,473. It is up 10.2% over five days and 26.3% over one month, with RSI at 89.45. MSTR gained 11.72% and COIN rose 5.45%, once again amplifying the underlying asset’s direction. On the prior trading day, US spot BTC and ETH ETFs recorded net inflows of $232.2 million and $192.4 million, respectively, so fund demand and price momentum currently agree. Momentum is already extreme, however, and maintaining the same slope would require ever-stronger inflows. Continued fund demand followed by sideways price action would improve the quality of the rally. Slower flows and earlier weakness in the proxy names would make the advance look more dependent on liquidity.
Power and uranium
AWS’s large GPU deployment reinforces the long-run electricity-demand story, but power names did not follow semiconductors today. VST fell 1.07%, NRG lost 2.23%, and CEG gained only 0.16%. Their one-month records also remain widely dispersed. SRUUF rose 0.4%, is up 9.9% over five days, and has an RSI of 76.11, leaving the fuel theme stronger than traditional power. Rates do not fully explain the divergence because long yields barely moved while the related names stayed under pressure. Power receives operating confirmation only when data-center projects begin to appear in utility capital plans and load guidance. Until then, valuation and project timelines can still offset the distant demand story.
Canada and the agriculture chain
The improvement in Canada’s current account did not produce broad strength, with XIU down 0.5% intraday. CF, NTR, and MOS fell 1.66%, 1.44%, and 2.61%, respectively, while Greer’s warning still lacked a formal product list. Energy exports support Canada’s external accounts, but manufacturers and agricultural businesses must still leave room for potential two-way tariffs in their cost planning. Today’s decline shows greater policy sensitivity, not that any specific tariff has entered earnings expectations. If the September implementation documents cover important intermediate goods, price pressure could spread through North American supply chains. If negotiations restart first, the weakness will look more like a temporary risk discount.
Upcoming events and decision framework
August 27 at 1:00 PM ET, 7-year Treasury auction: Watch the high yield, indirect demand, and dealer allocation. Weak demand would make the stable 5-year result look maturity-specific. A strong auction would show that high long yields are attracting genuine demand.
August 28, Jackson Hole keynote, with the exact time pending the formal agenda: Watch how Warsh balances sticky inflation, trade costs, and resilient growth. A clear preference for restrictive rates over a longer period would validate the 30-year yield above 5%. A shift toward growth risk would give the decline in short yields a chance to move farther out the curve.
September 1 at about 4:30 PM ET, API report, and September 2 at 10:30 AM ET, EIA petroleum report: Watch whether SPR stocks keep falling and whether commercial crude, gasoline, and distillates tighten together. Comfortable inventories would support the energy market’s muted response to Hormuz and Russian refinery risk. Broad draws would return supply risk to pricing.
September 3 at 10:30 AM ET, EIA natural-gas storage report: Watch whether injections remain below seasonal norms and whether the cushion over the five-year average narrows. Another low injection would strengthen the power and fuel demand story. A normal reading would make this week’s result look weather-related or regional.
September 8, planned implementation of Canada’s retaliatory measures: Watch the final product list, exemptions, customs details, and any additional US action. A verifiable agreement before implementation would narrow the North American cost shock. Measures from both sides would extend uncertainty for pricing and hiring.
Risk disclosure
This article is public market commentary and personal research notes. It does not constitute investment advice.
