Producer inflation cools.
AI expectations rise.

Producer inflation was softer than forecast while layoffs remained limited.

The Producer Price Index for final demand was unchanged in July after a revised 0.1% decline in June and rose 4.7% from a year earlier. Final-demand goods prices fell 0.7%, including a 3.1% decline in energy, while services rose 0.2%. A narrower measure excluding food, energy, and trade services rose 0.4% for the month and 4.7% annually.

Why it matters: the report reduces the immediate pressure for another rate increase, but the annual measures remain well above the Fed’s 2% inflation objective and July’s data predate much of the latest oil volatility. Initial claims rose 9,000 to 209,000 in the week ended August 8, while continuing claims fell to 1.777 million. Treasury investors, banks, homebuilders, leveraged borrowers, consumers, and rate-sensitive equities are affected. Watch Friday’s retail sales and inflation expectations, August labor and CPI data, and the September 15–16 Fed meeting.

Cisco reported record quarterly revenue and large hyperscaler orders, yet its shares fell as investors focused on margins and the pace of acceleration.

Fiscal fourth-quarter revenue rose 17.6% to $17.25 billion. Cisco received $4 billion of AI-infrastructure orders from hyperscalers during the quarter, taking the fiscal-year total to $9.3 billion, and forecast fiscal 2027 revenue of $72.2 billion to $73.4 billion. Its first-quarter adjusted gross-margin outlook of 65% to 66% was slightly below the market estimate cited by Reuters.

Why it matters: AI networking demand is translating into orders and revenue, but a hardware-heavy mix and component costs can dilute the margin benefit. Cisco shareholders, networking suppliers, optical-component makers, cloud providers, semiconductor companies, and data-center investors are affected. Watch order conversion, component availability, gross margins, and whether enterprise demand broadens beyond hyperscalers.

Cerebras fell more than 18% before the open after mixed results, even as the broader semiconductor index had gained 2.5% Wednesday.

The selloff followed results that included rapidly growing cloud revenue but missed key market expectations, according to Reuters. Cisco was also down roughly 7% before the open despite record revenue and above-consensus annual guidance, while several other computer-hardware companies advanced.

Why it matters: investors are separating AI beneficiaries based on margins, competitive position, financing requirements, and the durability of customer demand rather than rewarding revenue growth uniformly. Cerebras, Nvidia, cloud-compute providers, chip designers, server vendors, and concentrated technology portfolios are affected. Watch customer concentration, gross margins, cash use, competitive benchmarks, and Applied Materials’ report after Thursday’s close.

Goldman Sachs agreed to acquire NEOS Investments for as much as $2.25 billion.

NEOS manages approximately $30 billion across 19 ETFs, with strategies that use options to generate income and manage downside exposure. Goldman expects the acquisition to close in the first quarter of 2027 and said the combination would increase its active ETF platform to roughly $80 billion.

Why it matters: the deal reflects rising demand for fee-generating, outcome-oriented products and Goldman's effort to expand steadier asset-management revenue. Goldman shareholders, NEOS clients, wealth advisers, active ETF competitors, options-market participants, and institutional allocators are affected. Watch regulatory approval, asset retention, distribution gains, fee levels, and whether the purchase price produces an acceptable long-term return.

Brent dropped about 2% to $87.30 as demand forecasts weakened, while the Hormuz dispute remained unresolved.

Commercial U.S. crude inventories posted their largest weekly increase since January 2023, and OPEC reduced its 2026 global demand-growth forecast. At the same time, Washington and Tehran continued to dispute the conditions for reopening normal Strait of Hormuz traffic. The dollar index was near 99.9, the 10-year Treasury yield was near 4.67%, and the 30-year yield remained close to a multi-decade high near 5.24% before Thursday’s bond auction.

Why it matters: cheaper oil reduces near-term headline-inflation pressure, but fiscal deficits, Treasury supply, and term premium can keep long borrowing costs elevated even if the Fed holds its short-term rate. Energy producers, airlines, transports, consumers, mortgage borrowers, banks, and long-duration assets are affected. Watch physical shipping flows, inventory data, the noon Central 30-year auction, and whether the yield curve continues to steepen.

No new private-credit transaction displaced today’s macro and AI stories. The latest material sector developments remain the Dallas and New York Fed’s planned survey of the more than $1.3 trillion U.S. direct-lending market, Goldman Sachs Private Credit Corp.’s second-quarter repurchase requests of 3.24% of shares, and Ares’s $8.2 billion of second-quarter U.S. direct-lending commitments.