U.S. Stocks Climb on Rate Cut Hopes, Nvidia Confidence

U.S. markets and stock indices rose slightly on Tuesday, stabilizing after a period marked by volatility ahead of this week’s expected results from chip manufacturing giant Nvidia (NVDA).

DJIA in Record-High Territory

The Dow Jones Industrial Average reached an all-time high on Monday as a rotation in technology stocks boosted the index’s components.

Year-to-date, the index has posted gains of 9.4%, while the S&P 500 has risen nearly 18%, and the tech-heavy Nasdaq Composite has gained just over 18%.

Sentiment Buoyed by Possible September Cut

Overall sentiment towards equity markets continues to be relatively positive on expectations of an interest rate cut.

Restrained comments from Fed officials, especially Chairman Jerome Powell, led traders to price in a cut of at least 25 basis points in September, according to CME Fedwatch.

The change in tone by the Fed, which came amid signs of considerable cooling in the labor market, has raised concerns about decelerating economic growth.

The most important item on this week’s economic calendar is the personal consumption expenditures price index due Friday, the Fed’s favorite inflation gauge.

Thursday will bring revised second-quarter GDP figures, as well as the weekly report on initial jobless claims.

Nvidia’s Results in the Spotlight

Retailer Nordstrom’s (JWN) quarterly results, due after the session closes, will be closely watched for indications of consumer health.

However, the week’s main corporate focus will be on Nvidia’s results on Wednesday.

The stock has been at the center of a large rally in AI-fueled and AI-driven valuations over the last year, although this reputation has come under threat in recent months, particularly in the broader technology sector.

Results from other major chipmakers, such as TSMC (TSM) and ASML (ASML), released in July, indicated that the chip manufacturing sector is still poised to benefit from the demand for artificial intelligence.

Separately, Apple (AAPL) reported Monday that Luca Maestri will step down as CFO in early 2025, while Skydance Media appears poised to take control of Paramount (PARA) after media executive Edgar Bronfman Jr. dropped out of the race for control of the media conglomerate.