U.S. stocks traded little changed Wednesday, with investors remaining on the sidelines ahead of earnings results from Nvidia after the close, which are set to shed more light on the AI trade.
At 09:35 ET (13:35 GMT), Dow Jones Futures gained just 1 point, S&P 500 Futures fell 2 points, or 0.1%, while Nasdaq 100 Futures dropped 13 points, or 0.1%.
Nvidia earnings set to provide more cues on AI NVIDIA Corporation (NASDAQ:NVDA), the world’s most valuable chipmaker, is set to report its second quarter earnings after the bell. The firm is expected to clock earnings per share at $0.644 on a revenue of $28.68 billion, with both readings picking up from the prior quarter.
Nvidia’s shares have spiked 160% so far in 2024, as the firm benefited greatly from increasing investment in artificial intelligence. The firm makes the most advanced artificial intelligence chips in the market, and is considered as a bellwether for AI demand.
Nvidia’s earnings also come after reports from a slew of other tech majors suggested that AI may not be as big an earnings driver as initially thought - a notion that had triggered sharp losses in tech valuations over the past month.
Earnings season continues Investors have had more earnings to digest, even ahead of the widely-anticipated Nvidia numbers.
PVH (NYSE:PVH) stock fell 7% after the clothing giant, which owns brands like Calvin Klein and Tommy Hilfiger, reported a drop in second-quarter sales.
Bath & Body Works (NYSE:BBWI) stock fell 5% after the retail store chain cut its annual sales forecast, a sign of weaker demand for its pricey products such as fragrances and scented candles in the face of still-high inflation.
Abercrombie & Fitch (NYSE:ANF) stock fell 12% after the clothes retailer’s CEO Fran Horowitz warned of an “increasingly uncertain environment” as macro conditions worsened, even after the company lifted its forecast for annual sales.
Kohl’s (NYSE:KSS) stock rose 4% after the department store raised its annual profit forecast after beating estimates for second-quarter earnings, helped by a tight leash on costs and leaner inventories.
Chewy (NYSE:CHWY) stock rose over 7% after the online retailer of pet products reported strong second-quarter earnings, exceeding expectations.
Wall Street buoyed by rate cut bets But despite some uncertainty over Nvidia and a rotation out of technology, Wall Street indexes closed at record highs on Tuesday buoyed by expectations for lower interest rates, especially after Fed officials struck a dovish tone in recent comments.
Investors are now almost entirely pricing in an interest rate cut in September, but are split over a 25 or 50 basis point reduction, CME Fedwatch data showed.
PCE price index data - which is the Fed’s preferred inflation gauge - is due later this week and is expected to provide more cues on a potential rate cut.
Jobless claims data due on Thursday is also expected to factor into expectations of a cut, especially amid growing anxiety that the labor market is cooling much more rapidly than expected.
