Strong earnings, record DJIA

Investment Analysis Clubs Macro Economic Trends and Risks
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Strong Earnings Power Dow to Another Record

Blue-chip average notches 24th high of the year, while Nasdaq slips

By Shradha Dinesh, The Wall Street Journal, Aug. 5, 2026

  1. Dow Jones Industrial Average rose 0.5% to a record high of 54349 on Wednesday, driven by strong corporate earnings reports.
  2. Nasdaq composite fell 0.8% as Alphabet shares dropped 4% following news of executive departures…

Earnings season has helped investors power through worries about war, inflation and the longevity of the artificial-intelligence boom. Signs of de-escalation with Iran have also helped extend the rally in recent sessions, with retreating oil prices relieving inflationary pressures and sparking gains in energy-hungry industrial shares…

Recent strong performance among tech stocks such as Nvidia, Amazon and Microsoft has built overall confidence that the AI-hyperscale narrative can continue to drive gains. That has also lifted industries downstream in the “AI food chain…” [end quote]

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Volatility has also calmed down in the overall SPX and also individual stocks.

Wendy

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More importantly the S&P 500 blew through to a record high. The 99-day clock has been reset.

The RSP (equal weight SPY) also was at an all-time high.

DB2

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News report this morning says hedge funds have abandoned tech stock. And this after a whole month of talking down AI prices at every opportunity. I think the news report is a joke.

Earnings of AI stocks have been much as expected. Nvida reports late in August. Expected to increase 30% yoy. And PE below 20. Not over valued. Investors likely to sell w earnings report on theory that AI sales boom is over. PE expected to fall 30% or more. Likely to be a great buy the dip opportunity. The investing herd is mostly nuts.

Meanwhile Warren Buffett cautions stocks are over valued.

Strong earnings are a good sign. As always someone asks how long that can go on. Successful investing requires courage and commitment.

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