A summary of key events and market trends during the month of August

Global Markets Updates

• July’s Korean retail unwind and the failure of Situational Awareness were the same accident in different clothing. Leopold Aschenbrenner’s fund — up 439 percent in the first half and running roughly four times leverage — held concentrated positions in SK Hynix, CoreWeave and Nebius, having been a cornerstone buyer of SK Hynix’s Nasdaq listing only weeks earlier. It lost 67 percent in July and sold the bulk of its public book to Citadel at a discount, shrinking from $45 billion toward $10 billion. In Seoul, 1.2 million retail accounts were margin-called and some 350,000 liquidated. August brought the aftermath: SEC subpoenas to four prime brokers, and a caution from Bank of America’s chief executive on leverage. Both SK Hynix and CoreWeave have since recovered.
• Nvidia‘s fiscal Q2 revenue reached $96.2 billion, up 106 percent year on year, with data centre revenue of $89.0 billion, up 117 percent. Adjusted EPS of $2.22 beat a $2.09 consensus. Third-quarter guidance of $108 billion, plus or minus two percent, comfortably exceeded the $104.2 billion consensus and assumes no data centre compute revenue from China, with gross margin guided modestly lower to 74 percent. Two details matter more than the headline: supply commitments have swelled to $279 billion, largely memory for Vera Rubin, and management now expects top-five hyperscaler capex of $1.3 trillion next year against $800 billion in 2026.
• Blended second-quarter earnings growth for the S&P 500 reached 50.4 percent — a record — with 86 percent of companies beating on EPS. Stripping out Alphabet and Amazon still leaves 32 percent growth. The more instructive story is dispersion in share price reactions. Microsoft and Amazon each gained roughly 8–9 percent, while Meta fell 9–10 percent, Apple 4–8 percent and Alphabet around 5 percent — the dividing line being whether AI spending maps to the revenue line. No one is guiding capex lower, and Alphabet turned free-cash-flow negative for the first time.
• Federal Reserve Chair Warsh delivered his first Jackson Hole keynote on 28 August, marking his hundredth day in office. He declined to offer either forward guidance or an explicit reaction function, arguing the Fed should not be the market’s primary reference point for the next trade. He reaffirmed the two percent PCE objective and described July’s 3.7 percent reading as concerning, and characterised financial conditions as not broadly restrictive — a firmer stance than in July. Bond markets responded: pricing for a September hike moved from roughly a third to 55 percent. We would treat two-way rate risk as live again
• After a spike in July the Volatility Index (VIX) traded most of the month below 16; indicating a low desire to hedge equity exposures. Coming after 2 months of negative price action we see investors adding risk back to portfolios here.

Is This Time Different?

The pace of change and progress in the world of AI is surprising even us.
While the cycle of human greed and fear likely remains the same everything else about this wave of tech feels genuinely different.

Key Markets

SGMC Forward Views

• No changes to our forward views this month