The Dividend Cafe - Thursday - July 30, 2026

Episode Date: July 30, 2026

Brian Szytel recaps a sharp market reversal day as prior rotation out of semiconductors flipped into a strong tech rebound, with semis up about 7% and several large names rising 10–15%. The Dow gained 613 points (+1.2%), the S&P 500 rose 1.7%, and the Nasdaq climbed 2.8%. A major software company posted blowout earnings and surged 16%—adding roughly $490B in market cap—though the broader software sector was down, making it an outlier. Despite escalations in the Iran war, WTI oil fell about 1%. He addresses an inflation question, distinguishing relative price shocks (tariffs/supply disruptions) from inflation as a broader monetary phenomenon, noting demand-pull, cost-push, and money-supply dynamics. Economic data included Q2 GDP at 1.5% (below expectations), jobless claims at 197K, PCE in line (headline 3.7% y/y; core 3.3% y/y), personal income +0.2%, and consumer spending +0.3%. 00:00 Market Reversal Recap 00:59 Tech and Earnings Surge 01:49 Oil and Geopolitics Oddities 02:03 What Inflation Really Means 03:16 Three Types of Inflation 03:30 Economic Data Rundown 04:41 Fed Outlook and Wrap Up 05:27 Closing and Tomorrow Preview Links mentioned in this episode: DividendCafe.com TheBahnsenGroup.com

Welcome to the Dividend Cafe weekly market commentary focused on dividends in your portfolio and dividends in your understanding of economic life. Welcome back into Dividend Cafe. This is Brian Sightel with you, your host this evening on quite a reversal day in markets. We've been talking a lot about rotation that has been coming out of some of these high-flying sectors like the semiconductors into other parts of the market, energy, staples, financials, health care. And that really did reverse today. And it was quite a vicious upswing in the semis, particularly. There was a lot of good earnings that had come out, particularly with some of the large names. And a lot of those names were up 10 to 15%.

The sector itself was up about 7% in that. And that was the big move on the day. And then it was interesting, too, because you did have broad performance. So like, for example, on the day, the Dow was actually up 613 points. Remember, it sold off 1100 yesterday. So take that with a grain of salt. This is about a 1.2% move on the day. S&P was up 1.7.

And then the NASDAQ, like I said, was up 2.8%. So big move in tech, particularly some of those semis and some of the AI-related names. You also had the biggest software company in the world report much better than expected blowout earnings. And that stock was up 16% itself. So if you think about a market cap of $2.5 trillion dollars, you get a move like that. This is almost a half a trillion market cap move in one day, $490 billion. It's just surreal to think about that.

That was a one day move higher because one company that sells software beat earnings so much. And it's great to see. They've got pretty much across the board. Their cloud business was on fire. It's just a total blowout earnings report. And it's good to see. That said, when you actually look at the software sector on the day was considerably down. So this was really just the outlier inside of the software names.

Everything else was up in more. the semis. So just a weird day overall. You also had escalation in the Iran war last night with U.S. bombing new sites and oil was actually down a little bit. So WTI ended up closing down about a percent. So like I said, I call it odd just because there was things that were counterintuitive like that. The question that came in today was about inflation and the definition that I had used, I think a few weeks ago in Dividend Cafe about it being caused by too much money chasing the same amount or too few goods and services. And the question was about whether other things play a role like tariffs or oil supply shocks and so on. And my answer is, of course, that they do. But

again, what we're talking about is not just relative price changes, but what inflation is described by in a monetary sense, a tariff or a shipping disruption does raise the price of something in a specific good, but given the money supply being fixed in a hypothetical, that money that isn't spent on one part of the economy is spent on another part. And so one price goes up a little one goes down a bit and then you have an offsetting effects. Even though tariffs and supply shocks, yes, they cause anomalies. They change the composition of prices, which prices are up and which prices are down. But it's the monetary phenomenon of money and the velocity of money that is in aggregate buying the same amount or more or less goods and services. And that tends to move

for the price level and change the direction. There's a delta on prices. I hope that makes sense. It's not that they're not relevant or not important. Of course, all of those things are. But I just wanted to make the distinction. Inflation really has three main types of it. There's a demand pull inflation, there's a cost push and a money supply alike. And my point to saying it that way, just money chasing two, few goods and services is to try to meld all of those things together and make it digestible for people. There was quite a bit of things out in the economic calendar. The market shrugged most of it off, but it was a good amount.

So there's one, two, three, four, five pieces out on the day. You had an advance estimate on Q2 GDP. this is an important number. We got a 1.5% print. We were actually thinking 1.8% to 2% would be more consensus. So this was a miss on GDP estimate. And if you think about the Fed and them holding rates steady, that looks prescient. If you look at it against a GDP number, that was a real just 1.5% rate. The initial jobless claim is still very robust. We're at 197. If you remember, the 196 print we got was the lowest in 40 years last week. So the jobless claims numbers continuing to be very low. Employment continues to be very strong. And then the important number on the

day was PCE. This number actually came out in line with the consensus. It was down a 10th for the month of June. We got to call that good, right? That's deflation. Prices are actually going down. And then you had a 3.7% year over year. That's headline. That includes a lot of the energy stuff that we're talking about. If you move out, food and energy, the core PCE number was also in line, and it was up 110th for the month, 0.1%, and it puts it at 3.3% year over year. So that's the main number the Fed looks at. That's higher than two, and that's what they don't like. And so they're jawboning and they're talking and there's a lot of rhetoric about being hawkish, but they have yet to really do anything. They didn't change the balance sheet and they didn't change interest rates. That's at our

priced in or what Fed futures is priced in is that they'll move before the end of the year. And I suspect that's probably accurate. The fourth thing was personal income was a 10th less than forecast, it still grew, though. It was positive by 0.2% in June. And then lastly, consumer spending was in line and still robust at 0.3% for June. So when I bake all that together, I get pretty much inline numbers. And that's why markets were much more of just a rebound day and an anti-rotation day back into some of the old yesterday year, performance of semis and such. But that's what I've got for you today. That's my Around the Horn. David has an amazing dividend cafe that I got a sneak preview on today for you in your inbox for tomorrow. And this will be about the Fed and why they

help rates and some of the qualitative things around the Fed and the changes that Warsh has. Okay, I'm going to end it there for you tonight. I appreciate listening, as always. Have a great evening. The Bonson Group is a group of investment professionals registered with Hightower Securities LLC, member FINRA and SIPC, and with Hightower Advisors, LLC, a registered investment advisor with the SEC. Securities are offered through Hightower Securities LLC. Advisory services are offered through Hightower Advisors, LLC. This is not an offer to buy or sell securities. No investor process is free risk. There is no guarantee that the investment process or investment opportunities referenced TIRAN will be profitable. Past performance is not indicative of current

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