Tax Code Advisors

Market Update — Sep. 4, 2026

The market finished lower today after the jobs report came in much stronger than expected. Stronger employment pushed Treasury yields higher and brought back the concern that the Fed may need to stay tighter for longer.

But the more interesting story was underneath the surface.

AI is not weakening — the market is becoming more selective about who actually benefits from it.

Semiconductors, networking, data-center infrastructure, cybersecurity and power-related names continued to attract money, while traditional software is being judged much more carefully.

A few names stood out:

PLTR — investors increasingly see AI as increasing demand for Palantir rather than replacing it.

CRWD — more AI means more automated systems, identities and attack surfaces, which can actually increase cybersecurity spending.

ORCL — increasingly being viewed as part software company and part AI infrastructure company.

HPE — strong earnings plus networking and AI infrastructure demand gave the move real fundamental support.

COIN & HOOD — benefited from crypto activity and stronger trading interest, but these remain much more speculative.

NOW — rebounded, but investors still need proof that AI will create more revenue than it destroys through fewer software seats.

TSLA — a good example of “buy the rumor, sell the news.” The stock rallied ahead of the Cybercab event and then reversed after the announcement.

One of the biggest losers today was FICO.

Fair Isaac fell as much as 21% after FHFA Director Bill Pulte again criticized the cost of credit scores. Equifax and TransUnion also fell.

The bigger issue is competition.

Fannie Mae and Freddie Mac are allowing lenders to use VantageScore as an alternative to FICO, and there has also been discussion about moving away from the traditional three-bureau “tri-merge” model.

That could become a meaningful threat to the economics of the credit-scoring industry.

Another important story: Norway’s roughly $2.3 trillion sovereign wealth fund is proposing to reduce government bonds from about 70% to 50% of its bond benchmark.

Reuters estimates that could eventually mean nearly $80 billion less exposure to U.S. Treasuries.

It would happen gradually, but the timing matters because investors are already becoming more concerned about government debt, deficits and the amount of new borrowing coming to market.

Energy inflation is also becoming harder to ignore.

Diesel reached about $5.85 per gallon, versus roughly $3.71 a year ago.

That matters because diesel flows through transportation, agriculture, construction and shipping costs.

If energy prices stay elevated, the Fed’s inflation problem becomes much harder.

Another interesting development is happening in the bond market.

After the selloff in debt tied to massive AI spending, some investors are starting to see value in Big Tech bonds, particularly from financially strong companies such as Google and Amazon.

That creates an interesting contrast:

Investors may worry about how much these companies are spending on AI, but their debt can still become attractive if yields rise enough.

And the AI trade itself is broadening.

This is no longer just about Nvidia.

Data-center demand is benefiting:

• Semiconductors
• Memory
• Networking
• Electrical equipment
• Cooling
• Power generation
• Construction
• Cybersecurity

The picture is becoming clearer:

Strong economy → higher rates
Higher energy prices → more inflation risk
Government debt → increasingly important issue
AI spending → still strong, but investors are becoming selective

The most important question for investors now may be this:

Who actually makes more money because of AI — and who gets disrupted by it?

The market seems to be separating stocks into two groups.

AI beneficiaries: chips, data centers, networking, cybersecurity, power and companies where AI increases usage.

AI disruption risk: traditional software companies where AI could reduce seats, pricing power or switching costs.

That may be one of the biggest stock-picking themes heading into 2027.

1 week ago | [YT] | 0

Tax Code Advisors

SEP 4TH Market Update: Strong Jobs, Higher Rates, Chips Holding Up

The latest jobs report came in stronger than expected. Normally, that sounds like good news. But for stocks, strong economic data can also mean the Fed has less reason to cut rates. In fact, Fed futures were pricing in two rate hikes by next March.

That is why the market is struggling to move higher even though the economy still looks relatively strong.

One interesting area is technology and semiconductors. The Nasdaq 100 held up better than the broader market, and the SOX semiconductor index moved back above its 50-day moving average. That suggests investors are still willing to buy selected technology names even while the rest of the market remains cautious.

At the same time, the market is becoming more selective.

1. Lululemon is not just “under pressure” — the business deteriorated sharply.
LULU was down about 18% today after Q2 revenue fell 4.3% to $2.42B, comparable sales dropped 9%, and Americas comparable sales fell 12%. More importantly, management cut 2026 revenue guidance from $11.0–$11.15B to $10.35–$10.50B and EPS guidance from $10.95–$11.15 to $9.48–$9.73. The reported $2.92 EPS also benefited by $0.86/share from a one-time tariff refund, so underlying earnings were much weaker. This looks more like a brand/product-demand problem in North America, not merely a bad quarter.

2. Tesla gave back gains because the Cybercab launch created new regulatory questions. TSLA was down roughly 5–6% today after launching its purpose-built Cybercab in Austin. The vehicle has no steering wheel or pedals, and NHTSA opened an audit into Tesla’s self-certification and whether the vehicle complies with federal safety standards. Tesla currently has only about 45 Cybercabs registered in Texas, while 128 robotaxis are operating in Austin across the broader fleet. Tesla says its unsupervised robotaxis have accumulated 1 million miles, but investors still do not have clear answers on final Cybercab pricing, production scale or nationwide deployment timing

3. The credit-stock selloff is much more significant than a general “regulatory concern.” FHFA Director Bill Pulte ordered Fannie Mae and Freddie Mac to allow all mortgage lenders to use VantageScore, after an initial rollout with 50 lenders. That directly attacks Fair Isaac’s FICO dominance in mortgage underwriting. FICO shares fell roughly 20% in early trading. Pulte also criticized Equifax, Experian and TransUnion — the three companies that jointly own VantageScore — for allegedly overcharging consumers and indicated further changes could include a bi-merge credit-reporting system. So the market is repricing the economics of the entire mortgage credit-scoring ecosystem, not simply reacting to vague regulation.

4. Today’s jobs report materially changed the Fed calculation.
The U.S. added 162,000 jobs in August, versus expectations around 55,000. Unemployment stayed at 4.1%, participation improved from 61.4% to 61.6%, and wages rose 0.3% MoM / 3.1% YoY. After the report, odds of a 25-bp September Fed hike increased to about 58%, from roughly 49% beforehand. Wall Street Strategies says the futures market is now pricing two hikes by next March

That explains the strange market reaction: good economic news is becoming bad valuation news. This morning's jobs surprise says the economy is still strong enough for the Fed to keep tightening. That matters most for stocks whose valuations depend on distant future cash flows. Higher Treasury yields reduce the present value of those earnings, so the vulnerable areas are high-multiple software, unprofitable growth, highly leveraged companies, housing-related stocks and rate-sensitive consumer names.

Meanwhile, there is an important positive underneath the surface: Technology is one of only three sectors higher today, semiconductors are attracting money again, and the SOX semiconductor index moved back above its 50-day moving average.

Semiconductors are showing relative strength, while the weakest areas have very company-specific problems:

LULU: collapsing North American comps + major guidance cut.
TSLA: Cybercab regulatory uncertainty immediately after launch.
FICO: potentially losing its mortgage-scoring monopoly.
EFX / EXPGY / TRU: FHFA questioning credit-bureau pricing and structure.

Set Up Time with Deepak Sharma EA via taxcodeadvisors.com/ to learn more

1 week ago | [YT] | 0

Tax Code Advisors

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4 months ago | [YT] | 0

Tax Code Advisors

Let's talk about what is driving growth for these companies - sign up for the upcoming meet up here (May 16th - Austin TX) .. taxcodeadvisors.com/event/tax-finance-lunch-learn-…

4 months ago | [YT] | 2

Tax Code Advisors

Austin Event Is Next Saturday May 16th at the Hilton Garden Inn (Round Rock TX) - 2310 N Interstate Hwy 35, Round Rock, TX 78681. Hot Indian Breakfast & Lunch will be provided. Limited Seats - Please reserve your now... taxcodeadvisors.com/event/tax-finance-lunch-learn-…

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Live Event In Round Rock TX - May 16th - Register on taxcodeadvisors.com/

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Tax Code Advisors

Today's Discussion Call be at 9:30 am PST / 11:30 am CST. Here is the Zoom Link - us02web.zoom.us/j/81548547971?pwd=LZB1xaHxQQ3HesPW… - YouTube Live link will be available. Please feel free to invite friends to today's call.

1 year ago | [YT] | 0

Tax Code Advisors

📉 Stock Market Downturns (2022-2024) 📊

🗓️ 2022:
📅 June: Inflation worries + Fed rate hikes → Bear Market 🐻
📅 September: S&P 500 dropped 📉 9% (Rates & Recession fears)
📅 October: Volatile start, partial rebound ↔️

🗓️ 2023:
📅 March: 🚨 SVB collapse → Financial stocks plunge 📉
📅 August: Inflation + Treasury yields 📈 = Market dip
📅 September: Seasonal weakness 🍂 + Fed worries

🗓️ 2024:
📅 February: Mixed earnings 😟 + Inflation fears 🛑
📅 May: Debt ceiling drama 💳 + Slow consumer spending 🛍️
📅 September: Global slowdown 🌍 + High bond yields 📊

⚠️ Markets are unpredictable—Stay informed, stay prepared! 💼📈

1 year ago | [YT] | 0

Tax Code Advisors

Tomorrow I will discuss the issue of Country Cap Limits on Green Card. What can we expect from Trump Administration. Subscribe to this channel for Tax, Finance & Immigration Updates.

Imagine there are 100,000 green cards in demand from Indian nationals and 1,000 from Iceland in a given year:


- Under the cap, India gets 9,800 green cards while Iceland also gets 9,800, even though India's demand vastly exceeds Iceland's.


- Without the cap, India’s share would increase proportionally, potentially receiving tens of thousands of green cards, while Iceland might receive far fewer, based on actual demand.

1 year ago | [YT] | 0

Tax Code Advisors

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