Amazon Fuels Stock Rally as Strong Manufacturing Data Complicates Rate Hike Outlook

The US stock market is experiencing a boost due to Amazon's nearly 5% increase on Monday. The company, along with Microsoft, is benefiting from cloud spending that's generating revenue rather than just burning capital.

However, the Philadelphia Semiconductor Index is down 2.8%, with Micron off 3.4%. This decline can be attributed to reports of Chinese rival CXMT considering another memory-chip plant in Beijing.

The ISM report has complicated the story, as it shows manufacturing at its strongest level since 2022, with employment expanding for the first time in nearly three years. This gives hawks the data they need, and a strong jobs report on Friday will likely solidify the case for a September rate hike.