As the closing bell approaches, U.S. stocks are leaning on the downside, reflecting market cautiousness with Nvidia’s (NVDA) impending quarterly results.
Expectations surrounding the chip giant have soared, especially in light of the artificial intelligence-fueled rally in the company’s stock, which has also significantly contributed to Wall Street’s overall bullish momentum.
The tech-heavy Nasdaq Composite (COMP.IND) trails the other two major averages, currently down 0.79% to 15,506.73 points in mid-day trade. A post-earnings decline in Palo Alto Networks (PANW) has exerted downward pressure on the index, following the cybersecurity company’s adjustment of its annual revenue and billings guidance due to industry softness. Other cybersecurity names and exchange-traded funds have also declined.
The benchmark S&P 500 (SP500) is lower by 0.30% at 4,960.75 points, while the blue-chip Dow (DJI) has retraced 0.22% to 38,480.07 points.
Revealing market dynamics, seven of the 11 S&P sectors are in the green, led by Energy and Utilities, while Technology has taken the lead among the losers.
All eyes are on Nvidia’s numbers, as Goldman Sachs’ trading desk has labeled it “the most important stock on planet earth.” Over the past few years, Nvidia has consistently outperformed, reporting a beat-and-raise quarter in seven of the last eight dating back to 2016. The exceptional performance is largely driven by its products’ artificial intelligence capabilities.
Notably, Nvidia has experienced a volatile performance, slipping back and forth in market cap ranking, signaling the intense anticipation surrounding its earnings release today.
Market participants are also eagerly awaiting the release of the Fed’s minutes for its latest monetary policy committee meeting, with a keen eye on any developments following the central bank’s pushback against the markets’ aggressive interest rate cut expectations.
Meanwhile, in the fixed-income markets, Treasury yields are higher ahead of an upcoming $16 billion 20-year bond auction. The longer-end 30-year yield (US30Y) is up 1 basis point to 4.47%, while the 10-year yield (US10Y) has risen by 3 basis points to 4.30%. The shorter-end 2-year yield (US2Y) is also up by 4 basis points to 4.65%.
Active movers include Garmin (GRMN), among the top percentage gainers on the S&P 500 (SP500), following the sports watch maker’s impressive quarterly top and bottom line performance.
On the flip side, Walgreens Boots Alliance (WBA) has experienced a downturn, a day after S&P Dow Jones Indices announced that the pharmacy chain would be replaced by tech and retail giant Amazon (AMZN) in the prestigious blue-chip Dow Jones Industrial Average (DJI) index.