The U.S. stock market is welcoming non-farm payroll data and a super earnings report week: SpaceX (SPCX.US) makes its debut, but can AI companies' earnings withstand the test of market valuation?

Notably, in the upcoming week, global markets will welcome U.S. employment data, Purchasing Managers Index (PMI) data, and a new round of intensive corporate earnings reports from U.S. companies. The U.S. will release the July non-farm payroll report, ADP employment data, as well as the ISM indices for manufacturing and services. Investors will use this information to assess whether the U.S. economy remains resilient and whether the Federal Reserve needs to further tighten monetary policy at the September meeting. The Federal Reserve kept interest rates unchanged at its July meeting, but internal disagreements over inflation risks have widened. Meanwhile, rising energy prices and persistent core inflation above the policy target have further amplified the impact of employment data on interest rate expectations. If July employment growth significantly exceeds expectations, Treasury yields and the dollar may continue to rise; if the labor market cools rapidly, market focus may shift back from inflation to risks of economic growth. On the corporate front, the U.S. earnings season for the second quarter is continuing to progress. AI software company Palantir (PLTR.US), semiconductor company AMD (AMD.US), SanDisk (SNDK.US), commercial space company SpaceX (SPCX.US), industrial equipment manufacturer Caterpillar (CAT.US), media and entertainment group Walt Disney Company (DIS.US), ride-hailing platform Uber Technologies, Inc. (UBER.US), pharmaceutical giant Eli Lilly (LLY.US), cloud software firm Datadog (DDOG.US), and ride-sharing platform Lyft (LYFT.US) will sequentially announce their performances. Among these, earnings reports from Palantir, AMD, SanDisk, and SpaceX will become important windows for the market to gauge AI software demand, data center chip growth, and valuations in the space economy; while the performances of Walt Disney Company, Uber Technologies, Inc., and Eli Lilly will provide new insights into consumer, transportation, and weight-loss drug markets. Important Event Preview The U.S. July Non-Farm Report is Approaching, Forecasts for Fed Rate Hikes Are Facing Repricing On Friday (August 7), the U.S. Bureau of Labor Statistics will release the July non-farm payroll report, which includes key indicators such as non-farm payroll numbers, the unemployment rate, and average hourly earnings. The market currently anticipates that the non-farm payrolls in July will increase by about 91,000, with the unemployment rate possibly rising from 4.2% to 4.3%. In contrast, the increase in non-farm payrolls in June was only 57,000, indicating a significant slowdown in employment growth. Investors will be paying attention to whether the slowdown in employment is a mild cooling or an early signal of a sharp deceleration in economic growth. If employment growth and wage increases significantly exceed expectations, it could strengthen the Fed's rationale for continuing to raise interest rates; Treasury yields, the dollar, and financial stocks may gain support, while high-valuation tech stocks and gold may come under pressure. Conversely, if the non-farm data significantly falls short of expectations and the rise in the unemployment rate exceeds market predictions, investors might reduce bets on Fed rate hikes, but fears of recession could also limit the upside for U.S. stocks. Thus, next week's market response will depend not only on the strength of the data but also on whether investors are more concerned about inflation or economic growth. U.S. ISM Index Data is Released, Economic Growth and Price Pressures Under Scrutiny On Monday (August 3), the U.S. will release the July ISM Manufacturing Index; on Wednesday (August 5), the U.S. will also release the July ISM Services Index. According to the ISM release schedule, the manufacturing report is typically published on the first business day of each month, while the services report is published on the third business day. For manufacturing data, the market will focus on new orders, employment, and production subindices to determine whether business investment and demand for goods can continue to expand. The price-paying index is also worth noting; in the context of rising international oil prices and transportation costs, this indicator may influence market perceptions of whether commodity inflation is about to pick up again. The services sector accounts for a larger share of U.S. economic activity, meaning that the employment and price subindices in the services sector may have a greater impact on Fed policy expectations. If both manufacturing and services indices continue to expand while price pressures rise, the market may further increase expectations for rate hikes this year. AI Earnings Reports Face Key Tests, Palantir, AMD, SanDisk Upcoming After the market closes on Monday (August 3), Palantir will release its second-quarter earnings report. The market will focus on U.S. commercial revenue, government business growth, new orders driven by its AI platform (AIP), and whether management raises full-year guidance. Palantir remains one of the higher-valued companies in the U.S. AI software sector; therefore, even if revenue and profits continue to grow, whether order volume, Remaining Performance Obligations (RPO), and future growth rates can support its current valuation will determine the stock price direction after the earnings report. Palantir has confirmed it will release its earnings after the market closes on August 3. After the market closes on Tuesday (August 4), AMD will release its second-quarter earnings report. Investors will focus on data center revenues, AI accelerator shipments, server processor demand, and changes in gross margins. As technology companies continue to increase investments in AI infrastructure, the market expects to see AMD secure more orders in the AI chip market and gradually close the gap with industry leaders. If AI chip revenues and guidance for the second half exceed market expectations, AMD's earnings report could lift the entire semiconductor sector; if order growth, product deliveries, or gross margins do not meet expectations, it could exacerbate investor concerns about the returns on AI capital expenditures. After the market closes on Wednesday (August 5), SanDisk will release its fourth-quarter and full-year earnings report for fiscal year 2026. The market will focus on SanDisk's fourth-quarter revenues, adjusted earnings per share, and gross margin performance, as well as management's latest guidance on NAND flash prices, market supply-demand, and product shipments for the new fiscal year. With the ongoing demand for high-capacity storage from AI servers and data centers, the revenue changes of enterprise solid-state drives (SSD), data center products, and high-end NAND products will become important indicators for assessing the quality of SanDisk's growth. SpaceX Will Release Its First Quarterly Earnings Report Since Going Public, with Starlink and Cash Flow in Focus SpaceX will also release its first quarterly earnings report since going public after the market closes on Tuesday, making it one of the most anticipated corporate events of the week. The market will be attentive to the number of Starlink users, satellite internet revenue, rocket launch frequency, government contracts, and expenditures related to the Starship project. Given the large fluctuations in SpaceX's stock price since its public listing, this initial earnings report will help investors evaluate whether the company's business model, profitability, and cash flow can support its high valuation. In addition to revenue and profits, management's comments on Starlink growth, Starship testing progress, space data centers, and AI-related businesses may also affect market sentiment. If the company can demonstrate stable cash flow and a clear path to commercialization, the stock price may find support; however, if capital expenditures and R&D costs continue to grow rapidly, the market may focus more on financing needs and potential stock supply pressures. Leaders in Consumer, Healthcare, and Industrial Sectors Upcoming Earnings Reports On Tuesday, Caterpillar (CAT.US) will release its second-quarter earnings report. The market will observe changes in global infrastructure construction, mining investment, and industrial demand through its construction, resources, and energy and transportation segments. Investors will also pay attention to the impact of raw materials, tariffs, and transportation costs on margins. If order volumes, distributor inventories, and full-year guidance remain stable, it could alleviate market concerns regarding a slowdown in global manufacturing. On Wednesday, Walt Disney Company, Uber Technologies, Inc., and Eli Lilly will release their earnings reports. Key highlights in the Walt Disney Company report include the profitability of its streaming business, theme park attendance, consumer spending, sports media performance, and changes in traditional TV revenue. The market will assess whether improvements in the streaming business can offset the pressures from the decline in traditional TV. For Uber Technologies, Inc., investors will focus on ride-booking volumes, delivery growth, margins, and free cash flow, while also examining whether autonomous driving partnerships will impact future cost structures and competition. Eli Lilly's focus will remain on demand for weight-loss and diabetes drugs. The market will pay attention to the sales of Mounjaro and Zepbound, production capacity expansion, supply conditions, and full-year guidance. With increasing competition in the weight-loss drug market, Eli Lilly's production capacity and drug pipeline will directly influence investors' assessments of its long-term growth prospects. On Thursday, Datadog and Lyft will release their quarterly earnings reports. Datadog's report will reflect corporate cloud spending, AI workload growth, and customer cost optimization trends. For Lyft, the market will focus on the number of active passengers, total bookings, insurance costs, and margins, comparing them to the performance of Uber Technologies, Inc.