US stocks reached near all-time highs on Thursday as investors continued to process the most recent data from AI chip major Nvidia and numerous other earnings reports. The Dow gained 0.16% and the Nasdaq gained 0.53% during Thursday’s regular session, while the S&P 500 increased 0.32% to reach a new all-time high.
Despite Nvidia’s conflicting signals, market confidence was supported by strong economic data and continued excitement over artificial intelligence. The chipmaker’s shares fell a little after it reported a 56% increase in quarterly revenue but left out possible sales in China from its future projection. Nevertheless, analysts maintained the sector’s momentum by increasing their price forecasts and restating their belief in AI-driven growth.
On Friday, US stock futures held steady as investors looked ahead to the release of the PCE price index, the Federal Reserve’s preferred inflation gauge, for fresh policy guidance.
From the same month one year ago, the PCE price index for June increased 2.6 percent. Excluding food and energy, the PCE price index increased 2.8 percent from one year ago.
Bureau of Economic Analysis will release the data for the PCE price index for August today, on August 29, at 8:30 a.m. EDT; 6 p.m. IST.
Rate Cut Outlook
Investor sentiment has been boosted after Powell hinted at lowering rates if the job market shows signs of weakness. Recently released jobs data show the employment sector is indeed a matter of concern for the US Fed.
So, despite inflation not being entirely under control, Powell and his team may resort to a rate cut in the September FOMC meeting. Although it is still unclear how tariffs would impact inflation, Fed Chair Jerome Powell said this week for the first time that economic conditions may call for a rate cut.
Stocks In Focus
In extended trading, Autodesk surged 10% and Ulta Beauty gained 2.5% after both companies issued upbeat forecasts, while Dell Technologies dropped about 5% on a weaker-than-expected outlook for the current quarter.
Even though Nvidia announced revenue and profit that exceeded analysts’ projections and provided an outlook that was largely in line with expectations, the company’s shares plummeted by about 1% on Thursday. Investors have very high expectations for the world’s most valuable firm’s earnings, and the stock may suffer if the company doesn’t achieve spectacular results.
The majority of other mega-cap tech equities saw increases. Chipmaker Broadcom’s (AVGO) stock increased by over 3%, Alphabet’s (GOOG) by 2%, Apple’s (AAPL) and Amazon’s (AMZN) by 1%, and Microsoft’s (MSFT) and Meta Platforms’ (META) by a tiny amount. Following the EV manufacturer’s announcement of another month of poor sales in Europe, Tesla’s (TSLA) stock fell 1%.
Macro Factors
The U.S. dollar index, which measures the performance of the dollar against a basket of foreign currencies, was down 0.4% at 97.88. The yield on the 10-year Treasury, which affects borrowing costs on all sorts of loans, fell to 4.21% from 4.24% at yesterday’s close.
The U.S. economy is staying more resilient to tariffs and high interest rates than it seemed last month. The Gross Domestic Product grew at an annual rate of 3.3% in the second quarter, the Bureau of Economic Analysis said Thursday. That was revised higher than the 3% annual rate in the BEA’s advance report last month, and a rebound from the 0.5% decline in the first quarter. The data is due to be revised one more time before being finalized.