The market is rewarding execution again.

Strong earnings are overpowering geopolitical noise, AI spending isn't slowing down, and investors are paying up for companies that can prove they're turning massive infrastructure investments into real profits. That's a healthy backdrop if you're betting on technology over the long run.

This earnings season is also showing the AI story is getting broader. It's no longer just about Nvidia. Companies across software, industrials, cloud infrastructure, and even space are benefiting from the buildout, and Tuesday's results reinforced that trend.

Friday's jobs report is the next big test. If the labor market continues cooling without cracking, this rally has another reason to keep climbing.

Today:

Let's get started.

This is not financial advice. Always do your own research. Past performance doesn’t guarantee future results.

Palantir shares surged 27% on Tuesday after CEO Alex Karp called second-quarter earnings "otherworldly" during the analyst call. The stock went from $25 in 2024 to $150 today in two years. Here's the contradiction: software stocks got crushed through June and July on fears that AI would replace them. Palantir was caught in that sell-off. Then it reported $1.05 billion in adjusted net income for Q2 and the narrative flipped. Suddenly, the software company everyone doubted became the software company that proved AI drives real profit, not theoretical upside.

The AIP platform is why. Launched April 2023, weeks after ChatGPT went live, it layers large language models directly onto Palantir's existing data analysis tools (Gotham for government, Foundry for commercial). Customers got AI-powered analysis attached to infrastructure they already owned. Deutsche Bank just upgraded to Buy and set a $200 price target, saying Palantir is "several steps ahead" of the rest of software in "converting AI demand into real customer value." The bank's exact phrase: "time traveler, having already arrived in the AI future others are still aspiring towards."

Palantir's still small relative to the opportunity. Commercial revenue hit $764 million last quarter with $6.24 billion in remaining deal value. Compare that to Anthropic's $47 billion annualized run rate. Both are chasing enterprise AI workloads. Palantir already had the customer relationships and the data infrastructure. Now it has the profit to prove the model works. That's the shift the market is pricing.

When it was put inside U.S. tanks, they moved almost silently and produced no smoke. Now, Elon Musk is using this strange technology to jump ahead in the AI race - and possibly change the course of history.

US stocks soared to fresh record highs Tuesday as earnings rolled in strong and investors grew hopeful for a breakthrough deal to reopen the Strait of Hormuz.

SpaceX reported its first-ever quarterly results as a public company, and they topped estimates across the board. Revenue came in at $7.8 billion versus the $6.81 billion consensus, up from $4.7 billion in Q1, while adjusted EBITDA hit $3.5 billion compared to the $2.0 billion Wall Street expected. CFO Bret Johnsen said "revenue growth accelerated across all our business segments" with "significant margin expansion led by our new AI compute agreements." Starlink subscribers topped 12 billion at the end of Q2. The stock still slipped in after-hours trading as investors brace for Thursday's lockup expiration, which will free hundreds of millions of insider shares for sale.

SpaceX also announced a partnership with Nvidia to design its Starmind AI-1 payload, bringing "datacenter class compute" into orbit using Nvidia's Rubin GPUs and Vera CPUs. CEO Elon Musk said on the earnings call that Nvidia would be the exclusive supplier of chips for SpaceX's AI needs.

Palantir stock exploded nearly 30% after what CEO Alex Karp called an "otherworldly" quarter. Commercial revenue from the US government surged 90% year over year in Q2. The blowout results helped propel a 6% rally in the Philadelphia Semiconductor Index, with Intel, Micron, and Nvidia all gaining momentum.

Caterpillar rallied after its sales and revenue topped $20 billion for the first time, making the Dow's second-largest component by weight another AI build-out beneficiary. The industrial giant's strong quarter added fuel to the broader market rally.

Oil prices tanked on hopes for a Hormuz deal. Treasury Secretary Scott Bessent told CNBC there's "a chance we may have a deal today or tomorrow" to reopen the Strait. US crude fell 5.4% to $75.98 per barrel, while Brent dropped 4.9% to $83.87. The sharp decline came after weeks of elevated prices that have driven massive profits for big oil. Exxon Mobil's second quarter profits doubled to $14.5 billion, while Chevron nearly quadrupled its profits to $12 billion. President Trump criticized both companies Monday: "They made too much money. They ought to give some of that back to the public."

The talks with Iran hit turbulence despite the optimism. Iran disputed claims that the two sides were talking, provoking frustration from President Trump, who called the Islamic Republic "unbelievably duplicitous" in a Truth Social post. The conflict has lasted more than five months and trapped oil tankers in the Persian Gulf.

Job openings slid slightly in June, matching expectations. The JOLTS report showed 7.4 million positions available, compared to 7.2 million a year ago. The hiring rate rose to 3.4%, while the layoff rate held flat at 1.1%. The labor market continues its "low-hire, low-fire" pattern heading into Friday's July jobs report, which will offer greater clarity on payroll growth and any movement in the unemployment rate.

Anthropic inked a $10 billion computing deal with Volta, the Nvidia-backed cloud startup, according to Bloomberg. The deal signals continued demand for AI compute capacity as frontier labs race to scale their infrastructure.

AMD, McDonald's, and Spotify also report earnings Tuesday, giving investors reads across chips, consumer spending, and digital media as earnings season continues.

Your feedback matters to us! Let us know what you liked or didn’t like about today’s edition.

That’s all for today. Did we miss anything? Smash the reply button to let me know.

Cheers,
Brandon & Blake of Invested Inc