8/4 US stock market - Tech stocks surge, US stock market hits record high, defensive stocks struggle to breathe
August 04, 2026 Market Analysis
## Today's market at a glance
On Tuesday, August 4th, the US stock market tested new highs again, driven by a rally in tech stocks. AI and digital transformation beneficiaries saw significant gains, with the Nasdaq and growth stocks performing strongly. Despite recent reports of moderate growth, persistent inflation, and unclear communication from the Fed, risk appetite continued.
Here's a summary for you:
- If your portfolio has a high weighting in growth and technology, today was likely a profitable day,
- Investors focused on dividend and defensive stocks (utilities, some REITs and energy) may have experienced relative underperformance compared to the market.
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## 1. Tech Stocks: AI and Automation theme reignites rally
Today's return: +4.84% (Sector leader)
7-day trend: 4 consecutive days of gains since the latter half of last week, today's surge accelerates short-term momentum
60-day trend: After adjusting and consolidating since early June, a clear upward trend has emerged since late July.
### What happened?
- Zebra Technologies (ZBRA): +26.47%
Zebra, which manufactures barcode, RFID and automatic data capture equipment, surged as demand for automation and digital warehouses in logistics, retail and manufacturing was strongly reflected. The market is not only valuing AI itself but also the "physical+digital" infrastructure where AI and data are applied in real-world settings.
- Gartner (IT): +21.85%
IT research and consulting firm Gartner surged on strong earnings and guidance, reflecting robust corporate IT spending on AI and cloud. This shows that CIOs are still prioritizing digital transformation investments over cost reduction.
- Arm Holdings (ARM): +17.86%
Arm's licensing and royalty growth story regained traction as demand for AI and high-performance computing (HPC) chips continues to rise. Expectations are growing that the proportion of Arm architecture will increase in both AI servers and edge devices.
Additionally, data and AI software companies such as Palantir (PLTR) recorded double-digit gains, reaffirming the market's confidence that "the AI investment cycle is still ongoing."
### Why is it important? (Investor perspective)
1. Shift towards "qualitative growth" stocks amid Fed and economic uncertainty
- Recent US real GDP growth was only 1.5% on an annualized basis, indicating moderate growth. Inflation indicators favored by the Fed are slightly exceeding the target (2%).
- The Fed has frozen interest rates at 3.5~3.75% and maintains its stance that future decisions will be "data dependent."
- In an environment with limited growth, the market tends to concentrate premiums on a select few stocks with genuine growth potential. Today's tech stock rally is a continuation of this trend.
2. Connection to long-term trends
- After a sharp rally (+approximately 13%) in mid-May, tech stocks experienced adjustments and consolidation from June to mid-July. Since late July (7/31), they have entered a clear upward trend (+6.2% so far).
- Today's surge is an important data point for gauging whether this marks the beginning of a new upward cycle. While there is short-term overheating risk, the overall trend remains bullish.
3. What it means for you
- Investors with a significant tech stock weighting should consider whether to realize short-term profits or follow the trend. Volatility (sector volatility in the 4% range today) is very high, so setting stop-loss and take-profit levels beforehand is crucial.
- If your tech exposure is low, you can view this rally as an opportunity for "stepwise accumulation" or wait for further confirmation of earnings and guidance before entering the market.
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## 2. Cyclical Stocks and Industrials: 'Real Asset' Investment Remains Strong Despite Growth Slowdown Concerns
Industrials Sector Today's Return: +2.16%
7-Day Trend: Following a strong rebound (+1.77%) in the latter half of last week, today's rally continues
60-Day Trend: A gradual upward trend since mid-May, with the upward momentum accelerating in early August
### Today's Highlights
- Generac (GNRC): +8.66% – A distributed power generation and energy solutions provider, benefiting from increased demand for energy infrastructure investment and climate risk preparedness.
- Thomson Reuters (TRI): +7.42% – A data and information services company, whose strong performance reflects the growing demand for digital transformation in legal, tax, and news data.
- Expeditors (EXPD): +6.13% – A global logistics company, showing resilience despite concerns about slowing trade and transportation demand, supported by supply chain restructuring and e-commerce volume.
### Why Are They Rising?
- In the current environment of moderate US economic growth (below 2%) and persistently high interest rates, corporate capital expenditures and AI infrastructure investment remain relatively robust. (apnews.com)
- The Industrials sector directly and indirectly benefits from this real asset investment and infrastructure spending.
- Looking at the 7-day performance, a continuous rebound has followed a -2.65% drop on July 29th. This can be seen as a normalization process from excessive pessimism in the short term.
### Investment Implications
- Cyclical stocks and Industrials tend to be highly volatile, so a conservative approach focusing on dividends and long-term economic recovery bets is generally recommended.
- Compared to tech stocks, many companies in this sector have relatively lower valuations, potentially serving as a hedge against overvalued tech stocks.
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## 3. Materials and Communication: Bottoming Out and Attempting a Rebound
### Basic Materials
Today's Return: +2.11%
7-Day Trend: Following three consecutive days of weakness, a two-day rebound follows yesterday's (+0.93%) gain.
60-Day Trend: Overall weakness (-1.5% cumulative) since May, but a gradual rebound attempt has been underway since mid-July.
- Freeport-McMoRan (FCX): +6.69% – A copper and gold producer, reflecting renewed expectations for copper demand driven by electric vehicles, data centers, and power transmission infrastructure.
- Nucor (NUE), Mosaic (MOS) also rose, demonstrating that long-term infrastructure and energy transition demand remains strong despite economic concerns.
### Communication Services
Today's Return: +1.28%
7-Day Trend: Following a -1.89% adjustment from July 29th to 30th, two consecutive days of gains since August.
60-Day Trend: Still underperforming with a -3.5% cumulative decline since May, but showing a short-term rebound since late July.
- Charter (CHTR): +6.22%, The Trade Desk (TTD): +5.79%, Match Group (MTCH): +3.59% led the gains.
- This indicates that consumer spending on advertising, streaming, and online services remains solid, with ad technology (AdTech) and subscription-based platforms continuing their structural growth story.
### Investment Points
- Materials and Communication Services have been relatively neglected sectors in the market for the past 2-3 months. Today's movement reflects a "valuation and positioning adjustment rebound + confirmation of structural demand."
- Given the potential for further pressure if the economic slowdown intensifies, a "long-term structural beneficiary leader stocks focus, phased buying" strategy is rational.
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## 4. Defensive Sectors: Utilities, Real Estate, and Energy Taking a Breather
### Utilities
Today's Return: -0.82% (Lowest among sectors)
7-day flow: 3 out of 4 trading days after July 29th were down
60-day trend: Showed a strong rally (+8.6%) until early June, driven by expectations for a peak in interest rates, but has been gradually adjusting since late June and showing a clear downward trend (-3.5%) since late July
- Utility stocks, which are dividend payers, continue to experience capital outflows today amid uncertainty about interest rates and the Fed.
- However, some companies such as American Water Works (AWK) have seen slight gains, indicating that differentiation is taking place even within defensive and essential infrastructure stocks.
### Energy
Today's return: -0.52%
7-day flow: Showed strength (+1.91%, +1.43%) last week in anticipation of a rebound in oil prices, but has been declining consecutively yesterday and today
60-day trend: Experienced significant volatility (sharp rise followed by sharp fall) from May to June, then rebounded (+10%) in July, but has since fallen again (-1.9%) after July 22nd
- Some service stocks such as SLB and Halliburton rose, but the sector as a whole is struggling to find direction amid mixed views on oil prices and demand, and the long-term theme of energy transition.
### Real Estate
Today's return: -0.12% (approximately flat)
60-day trend: Has been in a gradual upward trend (+4.1%) since mid-June, but has taken a breather over the past two days
- Discussions about the peak interest rate continue, but high mortgage rates and commercial real estate refinancing costs are still limiting upside potential. (apnews.com)
### Investment Implications
- Dividend and defensive sectors are assets that focus on stable cash flow rather than short-term capital gains.
- They may be relatively sidelined in risk-on market environments like today, but as the Fed continues to increase market volatility with "uncertain communication" (axios.com), they are likely to continue playing a role as stabilizers and buffers in portfolios over the medium to long term.
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## 5. Finance & Consumer: Resilient but not the "lead role"
### Financial Services
Today's return: +0.69%
7-day flow: After consecutive slight declines from July 29th to 31st, has recovered for two consecutive days since the beginning of August
60-day trend: Gradual upward trend (+13.4%) since June, with a consistent upward trend continuing since July 2nd
- Alternative investment and private equity firms such as Apollo Global Management (APO) and Ares (ARES) have been strong performers, reflecting the movement of capital seeking opportunities in a high interest rate environment.
- However, concerns about economic slowdown and credit cycle volatility are keeping large bank stocks relatively cautious.
### Consumer (Consumer Cyclical & Defensive)
- Consumer Cyclical: +0.51%
- Booking, Expedia, Williams-Sonoma and others are strong performers, signaling that travel, furniture, and premium consumption remain resilient.
- Consumer Defensive: +0.91%
- Clorox, Kimberly-Clark, Church & Dwight and other consumer staples companies have risen. This indicates that basic consumption is holding up well even amid high interest rates and inflation.
### Investment Perspective
- The consumer sector as a whole has continued the gradual upward trend (defensive consumer +7%, cyclical consumer +6.9%) seen over the past two months.
- As long as moderate economic growth and resilient employment continue, a "recession bet" may be less appropriate than a "moderate growth + selective consumption sector" strategy.
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## 6. Big Picture: Fed, Opaque Guidance, and Sector Rotation
The most important macroeconomic backdrop today is the possibility of a change in the Fed's communication strategy.
- Federal Reserve Chairman Kevin Warsh recently stated that the Fed intends to be less transparent about its "reaction function" (how it responds to economic indicators). (axios.com)
- For investors, this means that "it will be harder to predict how interest rates will move in the future," and as a result:
- Short-term bond and stock market volatility could increase,
- The speed of sector and style rotation (movement of money) could accelerate.
In addition, recent economic data shows:
- GDP growth is around 1.5%, indicating a slowdown,
- The Fed's preferred inflation measure remains near the target (2%) but is slightly elevated.
( apnews.com)
In essence,
> "The economy is cooling, inflation hasn't been fully tamed, and the Fed wants to say less."
This creates a somewhat uncomfortable combination.
On days like today, when technology and growth stocks surge while defensive sectors lag, it could be interpreted as a signal that "the market is betting more on long-term growth stories than the immediate slowdown." However, it also means there's a higher chance of a reversal if future data or Fed statements deviate from market expectations.
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## 7. Questions Investors Can Ask Themselves Now
Based on today's data, here are some questions to ask yourself:
1. What percentage of my portfolio is allocated to technology and growth stocks?
- If you felt "too little" or "too much" during today's rally, it could be a signal for rebalancing.
2. Do I have enough dividend-paying and defensive assets?
- As the Fed becomes less transparent, market fluctuations could intensify. Defensive sectors may underperform in the short term, but they are crucial for building a portfolio that can withstand volatility.
3. Which sectors will I consider "core" (long-term holdings) and which will be "top-down and strategic bets"?
- For example, technology, healthcare, and consumer staples could be considered long-term structural growth sectors, while energy, materials, and industrials might be subject to strategic adjustments based on economic cycles, policies, and commodity prices.
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## Conclusion: What Today's Numbers Are Telling Us
- In the short term, AI and digitally driven technology stocks remain "star players" leading the market,
- In the medium term, we are in a phase of accelerated sector rotation driven by slowing growth and the Fed's uncertain communication,
- In the long term, investment cycles related to physical infrastructure, energy transition, and the data economy are linking technology, industrials, and materials into a larger theme.
The big picture for today is this:
> "The Fed is being quiet, the economy is growing slowly, but on the long wave of AI and digital transformation, the market is still leaning towards growth stocks."
Today is a good day to check where your portfolio stands on this wave and how balanced it is.
This content is for informational purposes only and does not constitute investment advice for any specific security or asset.
Source: https://nextinvest.org/ko
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