Mid-Morning Look: August 18, 2026

Mid-Morning Look

Tuesday, August 18, 2026

U.S. stock markets open lower as the names that were higher on Monday such as semiconductors (SOX), data centers and precious metals are seeing early weakness, while defensive sectors such as Consumer Staples, Healthcare and REITs are rallying in another sector rotation, and Energy outperforms as oil prices hit highest levels in weeks. Global bond yields surged to multi-decade highs as expiring U.S.-Iran ceasefire talks collapse, pushing oil prices higher and stoking fresh inflation fears. President Trump said on social media today, “There are no talks or conversations going on, or scheduled, with the Islamic Republic of Iran. The Naval Blockade remains in full force and effect. The Hormuz Strait is open and operating. All Water mines have been removed or detonated.” A day after the PHLX Semi Index (SOX) topped its 50dma resistance of roughly 12585, the index falls notable this morning -5.2% to below 12,000 in strong pullback for semis/AI space. At the same time, investors rotate back into software names and some hyperscalers which fell Monday.

Higher oil and rising Treasury yields the past few sessions is what is moving markets lower (after the S&P 500, Dow Jones Industrial Average and the Russell 2000 hit record highs recently) as front month Brent crude oil rose 2.5% on Monday to $91 per barrel, highest since July 24 though only minimal gains today despite reports of another attack on a ship near Oman. WTI is tracking higher around $85 per barrel after the squeeze yesterday on reports that Iran has seized a UAE-owned tanker in the Strait. President Trump’s threat to attack Oman added to concerns along with data showing shipping has slowed dramatically in the Strait of Hormuz with fewer ships passing through. The 30-yr hit fresh 19 year highs above 5.34% this morning and the 10-yr above 4.74% but have since pulled back off highs and edged lower.

• Import prices fell (-0.4%) in July, versus +0.1% expected while July export prices fell (-1.3%) vs. consensus +0.2% and vs June (-0.7%). July y/y import prices rose +5.9% (down from +7.1%), while export prices rose +8.2% (down from +10.2% m/m). U.S. July non-petroleum import prices +0.3%, year-over-year +4.5% and July Petroleum import prices (-7.5%) vs June (-4.3%).
• July Industrial Capacity Utilization reported at 76.3% (in line with expected) while June was revised up to 76.2% from 76.1%; Manufacturing capacity utilization: 76.0% (up from 75.7% in June, +30 bps). July Industrial Output +0.2% (vs. consensus +0.3%) vs June +0.3%.
• July Pending Home sales -2.2% from July 2025 while U.S. July Pending Home sales index -2.3% (consensus +0.3%) to 71.2.
• The US Treasury International Capital report for June showed total net TIC flows of $133.5B (prior: $131.5B) and net long-term flows of $172.7B (prior: $231.2B). The headline was broadly stable month-on-month, but the $60bn deceleration in long-term flows was the standout.
• Total foreign holdings of US treasury fell $72.1B in June — the largest single-month decline since March’s $134.4B plunge and the second largest of 2026.

• In REITs: Keybanc changes in Retail REITs, upgrading AKR to Overweight from Sector Weight ($25 PT) and downgrading KRG to Sector Weight from Overweight. AKR’s YTD underperformance (+3.4%, -1,480 bps vs. Shopping Center REITs and -1,520 bps vs. the RMS) has created an attractive entry point as visibility improves around several earnings growth drivers. REXR agreed to sell a portfolio of 22 industrial properties to an affiliate of EQT Real Estate for about $1.2 billion, part of its $2 billion plan to dispose of non-core assets and recycle capital.

• AS +3%; Q2 revenue rose 32% y/y to $1.63B topping est. $1.54B, while adjusted EPS for Q2 rose $0.18; raises full-year 2026 revenue growth guidance to about 24% and now sees 2026 gross margin at 60.5–61.0% and operating margin at 14.2–14.5%.
• BBWI +5%; upgraded to Buy at Citigroup saying believes the combination of a Q2 EPS beat, positive tone about recent product launches, and potential upside to estimates from energy prices/tariff refunds, along with a depressed stock price creates a very attractive risk/reward.
• DUOL +5%; was upgraded to Buy from Neutral at DA Davidson with $160 tgt saying the company’s product enhancements, marketing changes and continued monetization improvements are underappreciated by investors as sees a long runway for growth in coming years.
• FLXS +13%; says consumer demand for furniture remains pressured by macroeconomic uncertainty related to ongoing conflict in Middle East; Q4 adj EPS $1.33 vs est $1.09 on revs $115.365Mm vs est $109.66Mm, gr mgn 30%; guides Q1 revs $111-115Mm vs est $106.8Mm.
• HAE +14%; disclosed a non-exclusive agreement in which CSL Pharma may utilize the company sNExSys PCS devices with Persona PLUS technology and related disposables in the US.
• TRGP +6%; shares were strong after the company announced a major expansion of its strategic relationship with XOM in the Permian Basin. Goldman Sachs said views the agreements as a significant positive for Targa’s long-term growth outlook.
• WEAV +31%; as Francisco Partners announced that FP has entered into a definitive agreement to acquire Weave, at an aggregate equity valuation of approximately $650M. Under the terms of the agreement, Weave stockholders will receive $7.40 per share in cash

• BIDU -8%; after Q2 revs fell -4% y/y to RMB31.33B vs. est. RMB31.96; said Q2 revenue from AI Cloud Infra rose 50% y/y, driven by mounting demand for public cloud-based AI computing; Q2 revs from AI applications increased 3% y/y; online marketing services segment revs of 13.1B yuan down -19% y/y.
• DCGO -25%; 2Q revenue/EBITDA below consensus while 2026 revenue guidance maintained, though EBITDA loss increased. Continues to target breakeven EBITDA exiting 2026.
• FN -18%; quarterly results beat on top and bottom line, largely on DCI strength while Datacom and HPC missed estimates again in FQ4 according to Barclay’s; new capacity on track and new programs ramping to fuel growth in FY27 and beyond.
• KLAR -20%; announces planned CFO/CMO transitions, Q2 results better ww/smaller net profit loss y/y of -$9M, revs rose 27% to $1.04B (est. $994M) and GMV rose 18% to $36.6B but lowers FY26 revenue view $4.08B-$4.16B from over $4.34B (est. $4.42B) and sees FY GMV $149B-$151B, down from prior view of greater than $155B.