Mid-Morning Look

Wednesday, September 10, 2025

The S&P 500 extends rally to a record 6,550, now up over +35% since the April 2025 bottom, as markets price-in rate cuts and tech again getting a boost, this time from Oracle. U.S. stocks rally behind another day of overly positive headlines as PPI inflation cools in August after jumping in July, while ORCL shares surge over 38% after earnings/backlog results, reinvigorating the AI trade (NVDA, AVGO, AMD, VRT shares surging). ORCL missed quarterly earnings but published an amazing multi-year revenue guides in software history saying: “As a bit of a preview, we expect Oracle Cloud Infrastructure revenue to grow 77% to $18 billion this fiscal year—and then increase to $32 billion, $73 billion, $114 billion, and $144 billion over the subsequent four years.” The guide and RPO backlog caught Wall Street by surprise, with shares surging overnight. Then tack on cooler inflation data for the producer price index (PPI), both on headline and core after July’s spike higher, and the recent decline in jobs data and lowered annual revisions to the tune of -911K jobs by the BLS yesterday and you are looking at a very high probability of a big interest rate cut cycle by the Fed, who has yet to cut rates since their 50bps decline right before the election last year. Right now, all news be taken favorably for markets. In trade news, President Trump asked the EU to impose up to 100% tariffs on India and China as part of joint effort to increase pressure on Russia to end Ukraine war, as per the Financial Times. Gold prices holding near record highs and even crypto rebounding with Bitcoin back above $114,000. Technology +2% followed by 1% gains for Energy and Utilities while Consumer Discretionary, Healthcare and Consumer Staples lag.

• July wholesale inventories revised to +0.1% (consensus +0.2%) from +0.2%; U.S. July wholesale sales +1.4% (consensus +0.2%).

• In Retail: NKE was upgraded to Buy from Hold at TD Cowen noting turnaround progress, margin recovery, with longer-term potential for $4+ in EPS/$6 billion in FCF. In pet retail, CHWY shares fell Q2 revs rose 8.6% y/y to $3.1B, above the $3.08B estimate though net income drops; guidance was above estimates for Q3 and FY, but not enough for Wall Street. Video game retailer GME advanced as Q2 results topped estimates.
• In Auto Suppliers: LEA was downgraded to Neutral from Buy at Bank America noting shares are currently trading below historical valuation but see little room for the stock to re-rate higher given the challenges the automotive industry is currently facing as the lack of support from auto production is a hurdle for Lear to deliver growth and margin expansion. The firm also cut BWA to Neutral from Buy saying recent contract awards are supportive to growth, but they won’t come to fruition until 2027-plus and the firm thinks investors want to see an inflection in company results to support stock momentum.
• In Aerospace & Defense: AVAV reported strong Q1 results, the first quarter with BlueHalo results fully integrated into the company as revenue and adj. EBITDA beat consensus by 3% and 7% respectively while bookings were just shy of $400M in the quarter with funded backlog growing to $1.1B. JOBY and UBER to expand global partnership to bring blade flights to Uber app as deal to bring blade’s helicopter & seaplane services to Uber app as early as 2026.

• BILL +5%; after the Financial Times reports Elliott Management has built a large stake in the payments automation company.
• GLSI +12%; said its breast cancer therapy, GLSI-100, got U.S. FDA’s “fast track” designation. The therapy is being tested in a late-stage trial for patients with HER2-positive breast cancer who have the HLA-A*02 genotype, and who finished standard treatment.
• ORCL +37%; said it signed four multi-billion-dollar contracts with three different customers in Q1, which resulted in RPO contract backlog increasing 359% to $455B; expects Oracle Cloud Infrastructure revenue to grow 77% to $18B in FY26 and then increase to $32B in FY27, $73B in FY28, $114B in FY29.
• PBPB +31%; as convenience-store operator RaceTrac struck a deal to purchase PBPB for roughly $566Min an all-cash deal, expected to close in the fourth quarter, that values Potbelly at $17.12 per share, about a 32% premium to Tuesday close.
• TVTX +22%; shares rise after the FDA informed the company that an advisory committee is no longer needed for its supplemental drug application for the treatment of a rare kidney disorder.
• VMEO +60%; enters into definitive agreement to be acquired by Bending Spoons for $1.38B; Vimeo stockholders to receive $7.85 per share in cash.

• CHWY -9%; shares fell Q2 revs rose 8.6% y/y to $3.1B, above the $3.08B estimate though net income drops; guidance was above estimates for Q3 and FY, but not enough for Wall Street.
• MTRX -11%; shares fell on results as Q4 adj EPS loss (-$0.28) on revs rose 14% y/y to $216.38M but below est. $232.25M and guides FY26 revenue $875M-$925M, below consensus $945.47M.
• NIO -8%; shares slipped after the company announces an equity offering of about 182 million Class A ordinary shares saying they will use net proceeds for investments in research and development, expand battery swapping and charging networks.
• RAPP -15%; as 9.62M share Secondary priced at $26.00.
• RBRK 15%; posted Q2 ARR beat by $27M, if slightly below the $30M+ the last several quarters, and some benefit from early renewals/expansions, while EBIT & FCF significantly beat by $54M & $61M, respectively. FY26 ARR guide raised about in line with FQ2 beat and FCF raised by $80M.
• SNPS -33%; shares tumbled after messy results for Q3, missing on the top and bottom line with weakness primarily tied to the IP business; mgmt blamed the Q3 and outlook miss on several issues, including export restrictions in China, delays at a major foundry, and IP product decisions that did not yield as expected.