U.S. markets ended mixed on Wednesday as optimism over a possible Middle East agreement supported blue-chip shares, while sharp post-earnings losses in SpaceX and AMD pulled technology stocks lower.
August 5, 2026
Wall Street ended Wednesday’s session on a mixed note, with the Dow Jones Industrial Average reaching another record close while technology stocks retreated from recent highs.
Healthcare and consumer shares supported the Dow after strong results from Amgen, Eli Lilly and Disney. The Nasdaq Composite, by contrast, recorded its first decline in five sessions as investors sold SpaceX and AMD following their quarterly reports.
The S&P 500 slipped modestly after closing at a record on Tuesday, suggesting that investors were taking profits following the market’s powerful start to August.
U.S. market closing levels
| Index | Closing level | Daily change |
|---|---|---|
| Dow Jones Industrial Average | 54,349.06 | +0.49% |
| S&P 500 | 7,723.52 | -0.17% |
| Nasdaq Composite | 26,363.44 | -0.83% |
| Russell 2000 | 3,019.19 | Approximately -0.6% |
The Dow gained 263.18 points to set a fresh closing record. The S&P 500 declined 13 points, while the Nasdaq lost 221.55 points. Reuters reported the final market figures.
Middle East optimism supports blue-chip stocks
Investor sentiment remained supported by signs of progress toward an agreement involving Iran, Oman and shipping through the Strait of Hormuz.
A proposed arrangement would give Tehran a supervisory role over vessels entering the Persian Gulf, potentially facilitating a broader normalization of commercial traffic through one of the world’s most important energy routes.
Expectations of reduced geopolitical tension have already pushed oil prices and Treasury yields lower. That combination is generally favorable for equities because lower energy costs can ease inflationary pressure and reduce the need for additional Federal Reserve rate increases.
The market nevertheless reacted cautiously. Investors have responded to several previous reports of diplomatic progress, only for negotiations to stall or tensions to rise again.
That caution helped explain why the S&P 500 failed to follow the Dow to another record.
SpaceX falls after its first public earnings report
SpaceX was one of the session’s largest and most actively traded losers, falling 13.6% after publishing its first quarterly results as a listed company.
The company reported strong revenue growth, supported by the continued expansion of Starlink and its space-launch operations. Operating losses also narrowed.
Investors nevertheless focused on the company’s rapidly increasing investment in artificial intelligence infrastructure and data centres. The concern is that SpaceX may need to sustain elevated capital expenditure for longer than previously expected, delaying meaningful free-cash-flow generation.
The end of SpaceX’s post-IPO lock-up period, beginning Thursday, created an additional overhang. Employees and early investors becoming eligible to sell shares could increase the available supply in the market.
The decline shows how demanding the valuation had become following the company’s high-profile initial public offering. Strong operating growth was not sufficient to support the shares once cash burn and potential insider selling returned to the centre of the investment debate.
AMD slides despite strong AI growth
Advanced Micro Devices dropped 7%, extending its post-earnings decline.
AMD reported robust revenue growth and issued a quarterly sales forecast above analysts’ expectations. Demand for data-centre processors and artificial-intelligence accelerators remained strong.
However, investors had expected an even more ambitious outlook after AMD shares gained more than 140% over the previous year.
The reaction reflected several concerns:
- investors want faster growth from AMD’s AI accelerator business;
- data-centre infrastructure spending must remain exceptionally high;
- gross-margin expansion has not fully matched revenue growth;
- and Nvidia continues to dominate the market for advanced AI processors.
AMD’s results were strong in conventional terms. But after the stock’s substantial rally, its valuation already assumed that the company would gain significant AI market share.
The decline contributed heavily to the Nasdaq’s underperformance and illustrated the high expectations currently attached to AI-related companies.
Eli Lilly rises as Mounjaro and Zepbound sales surge
Eli Lilly gained 4.9% after raising its full-year revenue forecast.
Second-quarter revenue increased 48% to $22.97 billion, while adjusted earnings reached $8.38 per share. Both figures exceeded expectations.
Mounjaro sales surged 91% to $9.94 billion, while Zepbound generated $4.93 billion. Together, the two tirzepatide brands represented almost 65% of Lilly’s quarterly revenue.
Management raised its 2026 revenue guidance to between $85 billion and $87 billion, compared with the previous range of $82 billion to $85 billion.
The results reinforced Lilly’s leadership in the injectable obesity and diabetes market and widened the commercial gap with Novo Nordisk.
Healthcare was consequently one of the strongest areas of the market. The S&P 500 healthcare sector gained approximately 1.3%.
Amgen provides more than 100 Dow points
Amgen advanced 4.6% after reporting a 9% increase in quarterly sales and raising its annual revenue outlook.
The pharmaceutical company benefited from strong demand for treatments including Repatha and Evenity. Its better-than-expected results contributed more than 100 points to the Dow’s gain because the blue-chip index is weighted by share price rather than market capitalization.
That structure means a large movement in a relatively high-priced Dow constituent can have a disproportionate effect on the index.
Amgen’s contribution helps explain why the Dow reached a record even though declining stocks outnumbered advancing stocks across the broader market.
Disney gains on streaming and parks
Disney shares rose 3.6% after the entertainment group exceeded quarterly profit expectations.
Its streaming business continued to improve, while theme parks and experiences delivered resilient growth. The company also benefited from stronger cinema performance and reiterated its full-year outlook.
Disney’s gain provided additional support to the Dow and helped offset weakness in technology and communication-services stocks.
Investors are increasingly focusing on whether Disney can sustain streaming profitability while continuing to invest in content, theme parks and new digital-distribution partnerships.
Booking Holdings leads travel shares
Booking Holdings gained approximately 6.5% after reporting strong travel demand.
The company’s performance suggested that consumers continue to prioritize travel despite concerns about inflation, interest rates and slower employment growth.
Travel companies can benefit from lower oil prices through reduced transportation costs and improved household purchasing power. However, the sector remains sensitive to geopolitical developments and any deterioration in consumer confidence.
Market breadth was weaker than the Dow suggested
The record close for the Dow concealed a relatively weak underlying session.
Declining shares outnumbered advancing shares by:
- 1.15 to 1 on the New York Stock Exchange;
- 1.34 to 1 on the Nasdaq.
The S&P 500 recorded 34 new 52-week highs and three new lows. The Nasdaq registered 107 new highs and 75 new lows.
This combination indicates that the market’s long-term trend remains constructive, but Wednesday’s gains were concentrated in selected blue-chip and healthcare stocks.
Investors should therefore avoid interpreting the Dow’s record as evidence of a uniformly positive session.
Trading volume remains elevated
Approximately 17.85 billion shares changed hands across U.S. exchanges, above the 20-session average of 17.34 billion.
Elevated volume was driven partly by earnings-related activity in SpaceX, AMD, Eli Lilly, Disney and Amgen.
High volume accompanying a sharp decline can be a negative technical signal because it suggests broad investor participation in the selling. The activity in SpaceX and AMD will therefore remain closely watched over the coming sessions.
At the broader market level, however, trading volume was only moderately above average rather than indicative of panic selling.
Economic data sends mixed signals
The ADP employment report showed that U.S. private employers added 44,000 jobs in July, indicating a slowdown in hiring.
Investors are awaiting Friday’s official employment report for a clearer picture of labour-market conditions.
A weaker employment environment could reduce wage and inflation pressure, but an unexpectedly sharp deterioration would raise concerns about economic growth and consumer spending.
Separately, the Institute for Supply Management’s services index increased to 54.1 in July from 54.0 in June. The figure was below the 54.5 expected by economists but remained comfortably above 50, indicating that the service economy continued to expand.
The data therefore supported a “slower but still growing” economic scenario.
Federal Reserve expectations remain uncertain
Interest-rate expectations continue to react to developments in the Middle East, energy prices and the labour market.
Minneapolis Federal Reserve President Neel Kashkari said it may be appropriate to begin gradually moving rates higher. That position reflects continuing concerns about inflation following the energy shock created by the Iran conflict.
Futures markets placed the probability of a September rate increase at approximately 54.9%, down from 58.3% a week earlier.
If oil prices continue falling and employment growth slows, investors may further reduce expectations for monetary tightening. A renewed increase in geopolitical tensions or energy prices could quickly reverse that outlook.
Oil and Treasury yields ease
U.S. crude-oil futures declined approximately 0.7% to around $75.22 per barrel, supported by expectations that diplomatic progress could improve shipping conditions through the Strait of Hormuz.
Lower oil prices benefit airlines, transportation companies and consumer-oriented sectors. They can also reduce headline inflation and improve household purchasing power.
Treasury yields moved slightly lower, providing some support to interest-rate-sensitive sectors. Technology stocks failed to benefit because company-specific earnings concerns dominated the session.
Major stock movers
Gainers
| Company | Approximate move | Principal catalyst |
|---|---|---|
| Booking Holdings | +6.5% | Strong travel demand |
| Eli Lilly | +4.9% | Raised outlook and GLP-1 sales |
| Amgen | +4.6% | Earnings beat and higher guidance |
| Nvidia | +4.4% | AI-chip demand and SpaceX supplier position |
| Disney | +3.6% | Profit beat, streaming and parks |
Losers
| Company | Approximate move | Principal catalyst |
|---|---|---|
| SpaceX | -13.6% | AI spending, cash burn and lock-up expiry |
| AMD | -7.0% | Guidance failed to exceed elevated expectations |
| Uber | Lower | Earnings-related selling |
| Insulet | Sharply lower | Company-specific results |
| Novo Nordisk ADR | Lower | Wegovy and CagriSema concerns |
Markets remain close to record territory
Despite Wednesday’s mixed performance, U.S. indices remain close to record levels after a powerful start to August.
Performance since the beginning of the year stands at approximately:
| Index | 2026 performance |
|---|---|
| Russell 2000 | +21.6% |
| Nasdaq Composite | +13.4% |
| Dow Jones | +13.1% |
| S&P 500 | +12.8% |
The strong performance of small-cap shares is notable. Smaller companies typically benefit from improving domestic growth expectations and greater access to credit, although they can also be more vulnerable to higher interest rates.
What investors should watch next
Attention now turns to:
- Thursday’s potential selling following the expiry of SpaceX’s lock-up;
- weekly U.S. unemployment claims;
- Friday’s official employment report;
- Federal Reserve comments;
- developments in the Iran and Oman negotiations;
- oil prices and shipping through the Strait of Hormuz;
- and post-market earnings from Block, DoorDash, eBay and MercadoLibre.
The market will also continue assessing whether the recent AI rally can broaden beyond a small group of companies.
The bottom line
Wednesday’s session highlighted a growing divide inside the U.S. equity market.
The Dow reached a new record as healthcare and consumer companies benefited from strong earnings and lower energy prices. Eli Lilly, Amgen and Disney all delivered positive contributions.
The Nasdaq declined sharply as investors questioned whether strong revenue growth at SpaceX and AMD justified their valuations and enormous investment requirements.
The broader market remains close to record levels, but negative breadth and elevated earnings expectations suggest that investors are becoming more selective. Companies must now demonstrate not only revenue growth, but also credible margins, cash generation and returns on their AI investments.
This article is for informational purposes only and does not constitute investment advice.
