S&P Nears Record on Benign US CPI, Cisco Disappoints, More
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News when you want it with Bloomberg News Now. I'm Doug Krisner. The stock market rose to within striking distance of a record high today after a subdued reading on retail inflation. We had the S&P 500 picking up two tenths of one percent, while a rally in chip makers sent the Philadelphia Semiconductor Index up two and a half percent. Dan Suzuki is a global investment strategist at iCapital.
I mean, it's very rare that all the sources of liquidity are rowing in the same direction. I mean, we have basically supportive monetary policy, fiscal policy, banking, lending standards, and animal spirits are very much intact. So everything's good. It's just the question is you look forward, you know, are those going to last and what could cause that to change?
That is iCapital's Dan Suzuki speaking earlier to Bloomberg Businessweek Daily. Now, in terms of retail inflation, core consumer prices rose in July by two tenths of one percent compared to June. And then if you look at it on an annual basis, the core CPI rose last month by two and a half percent. Now, these figures may give the Fed more room to weigh inflationary pressures against markets. the recent slowdown that we have seen in hiring, money markets are pricing in less than a 50% chance of a Fed rate hike at the September meeting. To earnings news next, after the bell, Cisco Systems issued a forecast for revenue in the current quarter above the average analyst estimate. Now, this reflects Cisco's success in supplying a larger share of the AI data center market with the company's networking gear.
We got reaction from David Bonson, founder and CIO at the Bonson Group. What
we've seen so far, we like. There's no big surprises to us. The thing I want to point out is that the hyperscaler growth, which is at and above target, is not the entirety of the growth. On one hand, if you look at their legacy businesses, which is what attracted us to the stock, networking orders, the non-hyperscaler orders, they're also up substantially-
That is David Bonson, founder of the Bonson Group, speaking earlier to Bloomberg. Now, despite that positive forecast, shares in Cisco are down in late trading by 4%. Cerebra Systems reported a surprising decline in AI hardware revenue. Now, this suggests the company is making inconsistent progress in selling computers with its novel chip design. Sales tumbled 23% from last year to $54.1 million. Now, the company's cloud division was the bright spot, with revenue nearly quadrupling to $126 million. We got reaction from Paul Meeks. He is head of tech research at Freedom Capital Markets. The
company's technology...
How did the benign U.S. CPI reading affect the S&P 500 and investor sentiment?
What they've done with their innovations in semiconductors may be the most impressive that we've seen in a long, long time. I just think it's going to be rougher than buy-side and sell-side investors think in ramping up capacity because they have two different businesses, a hardware business and a neocloud business.
He is Paul Meeks from Freedom Capital Markets speaking earlier to Bloomberg. Now, the results show a mixed picture for Cerebrus as it tries to challenge NVIDIA while at the same time building a bigger AI cloud business. Shares in Cerebrus are down 15% in late New York trading. Los Angeles Lakers owner Mark Walter is selling a majority stake in the team to a group led by Bob Iger and Josh Kushner. This deal represents a longtime dream of Iger, the former CEO of Disney. Together with Kushner, the two had been seeking to acquire an NBA expansion team in Los Angeles, but they pivoted. And we are told this deal values the Lakers at around $12.5 billion, marking the highest ever valuation for any sports team.
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