Software ripped, breadth didn't — and Warsh speaks at 10
Salesforce rose 22% and Okta 28%, yet 59 of 100 large caps fell. Marvell dropped on a record quarter. Fed Chair Warsh speaks at 10 a.m. ET.
Thursday looked like a broad technology rally and was not one: the Nasdaq gained 1.57% while 59 of the 100 largest US stocks in our feed actually finished lower. The narrow group that did the work — enterprise software and cybersecurity — now has to hold those gains through Fed Chair Kevin Warsh’s first Jackson Hole keynote at 10 a.m. ET.
Enterprise software was repriced in a single session
The move was not a normal earnings reaction. Salesforce closed at $251.96, up about 22% from Wednesday’s $205.62. Okta finished at $172.89, up roughly 28%. CrowdStrike closed at $227.95, up 20.5%. Behind them: Veeva Systems $282.16 (+15.3%), Synopsys $464.98 (+13.4%), Palo Alto Networks $382.73 (+12.7%), ServiceNow $138.43 (+10.0%), MongoDB (+8.5%), Cloudflare (+8.2%) and Datadog (+6.7%).
Salesforce, Okta and CrowdStrike each beat expectations and raised their outlooks, and all three pointed at the same driver — demand created by AI agents rather than demand destroyed by them. CrowdStrike’s George Kurtz framed it as AI driving more attacks and therefore more security spending; Salesforce’s chief executive spent his call pushing back on the idea that AI makes subscription software obsolete.
The size of the reaction is the tell. Companies of this scale do not move 10–28% in one session on a quarter alone. This cohort had been priced for AI disruption, and Thursday reset it toward AI beneficiary. That is a re-rating of the story, and re-ratings are the kind of move that gets tested rather than confirmed in the following sessions.
Marvell fell on a record quarter
The counterexample arrived after the bell. Marvell reported record revenue of $2.739 billion, up 37% year over year and ahead of expectations near $2.72 billion, with adjusted earnings of $0.94 against $0.93 estimated. It guided the current quarter to roughly $3.15 billion at the midpoint and $1.05–1.15 per share.
Our feed shows the stock closing the regular session at $241.47 — already down from a $253.41 open — and printing $222.62 in after-hours trade on 2.4 million shares, about 7.8% below the close. A beat, a record, and a raise, and the stock lost nearly a tenth of its value.
Put the two sections side by side and the day has a clear shape. For AI-adjacent software, merely good was worth 20%. For AI hardware, a beat-and-raise was not enough, because the bar had already been set at beating by a lot. The same divergence showed up inside semiconductors: AMD closed down 0.89% on the very day Nvidia rose 8.7% to $228.05. Nvidia’s guidance was not read as a sector-wide read-through.
The breadth does not match the headline
The index numbers say strength — the S&P 500 rose 0.72% to 7,730.99 and the Nasdaq Composite climbed 1.57% to 26,541.35. Our snapshot of 100 large caps says something narrower: 41 advanced and 59 declined.
Most of the megacap complex sat out or funded the move. Microsoft rose 1.75% to $505.06 and Apple added 0.36% to $314.58, but Alphabet fell 0.39%, Meta 0.87% and Amazon 1.54%. The clearest sellers were defensives and steady compounders: McDonald’s −2.57%, Merck −2.33%, Costco −2.24%, Abbott −2.20%, Altria −2.10%, alongside GE −3.29%, Spotify −4.14% and Disney −2.56%.
That is the signature of a rotation, not a lift. Money came out of defensive positioning and index-heavyweight megacaps and went into one specific software and security cohort. An index-level gain describes the outcome accurately and the market’s internals badly.
Warsh at 10 a.m. is the day’s actual event
Futures this morning are close to unchanged and slightly heavier where Thursday’s winners live: Dow futures +0.2% at 53,627, S&P 500 futures roughly flat at 7,740.25, Nasdaq-100 futures −0.3% at 29,617.50 and Russell 2000 futures −0.2% at 3,013.10. Gold is down 0.42% at $4,644.30 and October crude is off 0.59% at $83.04.
Warsh delivers his first Jackson Hole keynote as Fed Chair at 10:00 a.m. ET, having succeeded Jerome Powell in May. The open question is whether he treats the rise in long-term yields as tightening the Fed has already been handed, or whether persistent inflation still argues for another move. Ten- and thirty-year yields sit not far off the multiyear highs reached earlier this month, pressured by both inflation and government debt concerns.
This is why the speech matters more than usual for Thursday’s winners specifically. High-multiple, long-duration software is the part of the market most sensitive to the discount rate, and Thursday’s re-rating implicitly assumed rates cooperate. Nothing in the earnings changes if Warsh leans hawkish — but what investors will pay for those earnings does.
What to watch today
- Fed Chair Kevin Warsh’s Jackson Hole keynote at 10:00 a.m. ET, his first as Chair
- MNI Chicago PMI for August
- University of Michigan consumer sentiment, final August reading, including the inflation expectations indices
- Kansas City Fed services activity index
- Whether Marvell’s $222.62 after-hours print holds at the cash open, and whether the rest of AI hardware follows it or Nvidia
- No notable earnings are scheduled today; Broadcom’s results and the next jobs report are the hurdles after this one
Not financial advice. iTrading Buddy summarizes publicly available market data and news; every figure above is sourced from the reporting available before the US open on the date shown. Verify anything you act on.