Markets digest the recent comments from Fed Chair Powell, while Walmart stock looks for support amid its dip. The Daily Breakdown dives in.
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What’s Happening?
Monday was a quiet day on Wall Street as crypto pulled back and as stocks generally declined throughout the session. Investors are digesting the Fed’s commentary from Friday while looking ahead to this week’s key events, which include GDP, PCE, and Nvidia’s earnings.
Mag 7
Small caps may have been the big winner on Friday, but they saw the steepest decline on Monday, with the Russell 2000 — tracked by the IWM ETF — falling more than 1%. The Dow followed, while the S&P 500 and Nasdaq 100 fared better, helped by strength in tech. Tesla jumped higher and was the best-performing Magnificent 7 name yesterday, while Alphabet hit another record high — its second in as many days.
Market-Wide Dip
Only two sectors finished in the green: Energy (XLE ETF) and Communications (XLC ETF). Everything else saw at least modest declines. Among the winners in those two sectors were ConocoPhillips and Valero, along with Alphabet, Netflix, and Electronic Arts.
Crypto Corner
Crypto is trying to find its footing this morning following the recent pullback, with Bitcoin dipping into a key support area. Among the larger coins, Shiba and Ripple are attempting to lead the way, while smaller names — like Berachain, Peanut the Squirrel, Filecoin, and Aave — are also bouncing.
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The Setup — Walmart
Walmart has now stalled near $105 twice in 2025, once in February and again this month. On the plus side, support has materialized in the $93 to $95 area over the last few months. As shares of WMT pull back, investors are keeping a close eye on this area — particularly as the rising 200-day moving average comes into play.
Analysts expect adjusted earnings to grow about 4% this year, then grow by roughly 12% in each of the next two years. On the revenue front, estimates call for growth of 4% to 5% annually for that same stretch. While that helps explain part of the stock’s 26% rally over the past year, its valuation — with a ~35x forward P/E ratio — is still a concern for some investors.
Options
As of August 25th, the options with the highest open interest for WMT stock — meaning the contracts with the largest open positions in the options market — were the September $100 calls.
Buying calls or call spreads may be one way to speculate on support holding amid a pullback. For call buyers, it may be advantageous to have adequate time until the option’s expiration.
For those that aren’t feeling so bullish or who are looking for a deeper pullback, puts or put spreads could be one way to take advantage.
To learn more about options, consider visiting the eToro Academy.
What Wall Street’s Watching
Warren Buffett ruled out an acquisition of CSX, instead throwing his support behind a new partnership between Berkshire’s BNSF and CSX aimed at strengthening coast-to-coast freight operations. The news weighed on CSX shares, which dropped 5%, and pressured other rail stocks as well. Investor hopes were high after Union Pacific announced a deal to acquire Norfolk Southern earlier this summer. Dig into the fundamentals for CSX.
ETH
Rate-cut hopes helped spur Ethereum’s rally to record highs last week, but crypto markets have since reversed. Ether dropped 9% from its all-time high, while Bitcoin looks for support. Related stocks also fell, including Coinbase, Circle, and Strategy. Despite the slide, ETH remains well in the green for 2025, up more than 30%. Check out the chart for ETH.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.