S&P 500 Hits Record High as Nvidia's Earnings Fuel AI Rally

S&P 500 hits record high as Nvidia results butress AI rally

Aug 28 (Reuters) - The S&P 500 hit a record high on Thursday after Nvidia's quarterly report fell short of investors' high expectations while confirming that spending related to artificial intelligence infrastructure remains strong. Shares of Nvidia (NVDA.O), opens new tab dipped almost 1% after Sino-U.S. trade uncertainties prompted the leading AI chip designer to exclude potential China sales from its quarterly forecast late on Wednesday. Investors viewed Nvidia's report, including a 56% surge in quarterly revenue, as confirmation that demand related to AI technology remains strong, supporting a rally in AI-related stocks that has propelled Wall Street to record highs in recent years. AI heavyweights Microsoft (MSFT.O), opens new tab and Meta Platforms (META.O), opens new tab gained about 0.5%, while Amazon (AMZN.O), opens new tab climbed 1.1%. AI chipmaker Broadcom (AVGO.O), opens new tab added 3%. "Nvidia is such an outlier that to say it was a disappointing print is only against the bar of borderline impossible expectations," said Ross Mayfield, an investment strategy analyst at Baird. "It's clear that the primary structural driver of this market, which is AI, is not going anywhere or cooling down." The S&P 500 was up 0.25% at 6,497.88 points, hitting a record high for a second straight day. The Nasdaq gained 0.54% to 21,705.67 points, while the Dow Jones Industrial Average was up 0.05% at 45,587.83 points. Six of the 11 S&P 500 sector indexes rose, led by communication services (.SPLRCL), opens new tab, up 1.04%, followed by a 0.6% gain in information technology (.SPLRCT), opens new tab. Nike (NKE.N), opens new tab climbed 0.2% after the sports apparel seller said it was cutting less than 1% of its corporate workforce as it struggles to reclaim market share lost to rivals. Reducing worries of a slowing economy, weekly jobless claims were lower than expected, while a separate report showed corporate profits rebounded in the second quarter. Expectations that the Federal Reserve will soon cut interest rates to shore up economic growth have contributed to Wall Street's recent gains. The spotlight is on Friday's Personal Consumption Expenditures data, and any signs of inflation increasing could temper broad expectations for easing at the Fed's policy meeting in September. Traders are pricing in more than an 80% chance of an interest rate cut next month, according to CME Group's FedWatch. On Thursday, Fed Governor Lisa Cook filed a lawsuit challenging U.S. President Donald Trump's attempt to remove her from office earlier this week. Coming later in the day are remarks from Fed Governor Christopher Waller, who is perceived as favoring lower interest rates and is among the candidates being considered to replace Fed Chair Jerome Powell next year. Data analytics company Snowflake (SNOW.N), opens new tab surged 22% after raising its forecast for fiscal 2026 product revenue, citing AI demand. HP Inc (HPQ.N), opens new tab rose 2% after beating quarterly revenue estimates on growing demand for AI-powered personal computers. Packaging food company Hormel Foods (HRL.N), opens new tab tumbled 13% after issuing a downbeat quarterly profit forecast. Declining stocks outnumbered rising ones within the S&P 500 (.AD.SPX), opens new tab by a 1.7-to-one ratio. The S&P 500 posted 27 new highs and four new lows; the Nasdaq recorded 105 new highs and 37 new lows. Reporting by Johann M Cherian and Sanchayaita Roy in Bengaluru, and by Noel Randewich in San Francisco; Editing by Devika Syamnath and Richard Chang Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Stocks Noel Randewich Thomson Reuters San Francisco correspondent covering the stock market with a focus on Big Tech, semiconductors and other Silicon Valley companies

S&P 500 notches record high close as Nvidia results buttress AI rally

Aug 28 (Reuters) - The S&P 500 notched a record high close on Thursday after Nvidia's quarterly report fell short of investors' high expectations but confirmed that spending related to artificial intelligence infrastructure remains strong. Shares of Nvidia (NVDA.O), opens new tab dipped as much as 2.9% after Sino-U.S. trade uncertainties prompted the leading AI chip designer to exclude potential China sales from its quarterly forecast late on Wednesday. Investors viewed Nvidia's report, including a 56% surge in quarterly revenue, as confirmation that demand related to AI technology remains strong, supporting a rally in AI-related stocks that has propelled Wall Street to record highs in recent years. AI heavyweights Microsoft (MSFT.O), opens new tab, Amazon (AMZN.O), opens new tab and Meta Platforms (META.O), opens new tab gained. "Nvidia is such an outlier that to say it was a disappointing print is only against the bar of borderline impossible expectations," said Ross Mayfield, an investment strategy analyst at Baird. "It's clear that the primary structural driver of this market, which is AI, is not going anywhere or cooling down." According to preliminary data, the S&P 500 (.SPX), opens new tab gained 19.62 points, or 0.30%, to end at 6,501.02 points, while the Nasdaq Composite (.IXIC), opens new tab gained 115.90 points, or 0.54%, to 21,706.04. The Dow Jones Industrial Average (.DJI), opens new tab rose 70.35 points, or 0.15%, to 45,635.58. Nike (NKE.N), opens new tab bounced between small losses and small gains after the sports apparel seller said it was cutting less than 1% of its corporate workforce as it struggles to reclaim market share lost to rivals. Reducing worries of a slowing economy, weekly jobless claims were lower than expected, while a separate report showed corporate profits rebounded in the second quarter. Expectations that the Federal Reserve will soon cut interest rates to shore up economic growth have contributed to Wall Street's recent gains. Investors on Friday will focus on Personal Consumption Expenditures data. Any signs of inflation increasing could temper broad expectations for easing at the Fed's policy meeting in September. Traders are pricing in more than an 80% chance of an interest rate cut next month, according to CME Group's FedWatch. On Thursday, Fed Governor Lisa Cook filed a lawsuit challenging U.S. President Donald Trump's attempt to remove her from office earlier this week. Data analytics company Snowflake (SNOW.N), opens new tab surged after raising its forecast for fiscal 2026 product revenue, citing AI demand. HP Inc (HPQ.N), opens new tab rose after beating quarterly revenue estimates on growing demand for AI-powered personal computers. Packaging food company Hormel Foods (HRL.N), opens new tab tumbled after issuing a downbeat quarterly profit forecast. Reporting by Johann M Cherian and Sanchayaita Roy in Bengaluru, and by Noel Randewich in San Francisco; Editing by Devika Syamnath and Richard Chang Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Stocks Noel Randewich Thomson Reuters San Francisco correspondent covering the stock market with a focus on Big Tech, semiconductors and other Silicon Valley companies

S&P 500, Dow score record high closes as Nvidia results buttress AI rally

Aug 28 (Reuters) - The S&P 500 and Dow Jones Industrial Average notched record high closes on Thursday after Nvidia's quarterly report fell short of investors' high expectations but confirmed that spending related to artificial intelligence infrastructure remains strong. Shares of Nvidia (NVDA.O), opens new tab dipped 0.8% after Sino-U.S. trade uncertainties prompted the leading AI chip designer to exclude potential China sales from its quarterly forecast late on Wednesday. Investors viewed Nvidia's report, including a 56% surge in quarterly revenue, as confirmation that demand related to AI technology remains strong, supporting a rally in AI-related stocks that has propelled Wall Street to record highs in recent years. Other AI heavyweights gained, with Alphabet (GOOGL.O), opens new tab adding 2%, Amazon (AMZN.O), opens new tab up 1% and chipmaker Broadcom (AVGO.O), opens new tab rising almost 3%. "Nvidia is such an outlier that to say it was a disappointing print is only against the bar of borderline impossible expectations," said Ross Mayfield, an investment strategy analyst at Baird. "It's clear that the primary structural driver of this market, which is AI, is not going anywhere or cooling down." The S&P 500 climbed 0.32% to end the session at 6,501.86 points, reaching a record high close for a second straight day. The Nasdaq gained 0.53% to 21,705.16 points, while the Dow Jones Industrial Average rose 0.16% to 45,636.90 points, exceeding its previous record high close on August 22. Seven of the 11 S&P 500 sector indexes rose, led by communication services (.SPLRCL), opens new tab, up 0.94%, followed by a 0.68% gain in energy (.SPNY), opens new tab. Nike (NKE.N), opens new tab slid 0.2% after the sports apparel seller said it was cutting less than 1% of its corporate workforce as it struggles to reclaim market share lost to rivals. Reducing worries of a slowing economy, weekly jobless claims were lower than expected, while a separate report showed corporate profits rebounded in the second quarter. Expectations that the Federal Reserve will soon cut interest rates to shore up economic growth have contributed to Wall Street's recent gains. Investors on Friday will focus on Personal Consumption Expenditures data. Any signs of inflation increasing could temper broad expectations for easing at the Fed's policy meeting in September. Traders are pricing in more than an 80% chance of an interest rate cut next month, according to CME Group's FedWatch. On Thursday, Fed Governor Lisa Cook filed a lawsuit challenging U.S. President Donald Trump's attempt to remove her from office earlier this week. Data analytics company Snowflake (SNOW.N), opens new tab surged 20% after raising its forecast for fiscal 2026 product revenue, citing AI demand. HP Inc (HPQ.N), opens new tab rose 4.6% after beating quarterly revenue estimates on growing demand for AI-powered personal computers. Packaging food company Hormel Foods (HRL.N), opens new tab tumbled 13% after issuing a downbeat quarterly profit forecast. Declining stocks outnumbered rising ones within the S&P 500 (.AD.SPX), opens new tab by a 1.2-to-one ratio. The S&P 500 posted 28 new highs and five new lows; the Nasdaq recorded 117 new highs and 52 new lows. Volume on U.S. exchanges was relatively light, with 13.8 billion shares traded, compared to an average of 16.7 billion shares over the previous 20 sessions. Reporting by Johann M Cherian and Sanchayaita Roy in Bengaluru, and by Noel Randewich in San Francisco; Editing by Devika Syamnath and Richard Chang Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Stocks Noel Randewich Thomson Reuters San Francisco correspondent covering the stock market with a focus on Big Tech, semiconductors and other Silicon Valley companies

S&P 500 posts record close, dollar edges up; Nvidia shares down after the bell

NEW YORK, Aug 27 (Reuters) - Major stock indexes rose and the S&P 500 posted a record closing high on Wednesday ahead of quarterly results from artificial intelligence leader Nvidia (NVDA.O), opens new tab, while the dollar recovered slightly from the previous session's drop despite ongoing concerns about the U.S. Federal Reserve's independence. A lawyer for Fed Governor Lisa Cook said she would file a lawsuit against U.S. President Donald Trump after he said he would fire her. Trump's statement left some investors worried about the independence of the U.S. central bank. Interest-rate sensitive two-year U.S. Treasury yields fell to an almost four-month low and the yield curve steepened as traders weighed the chance that Trump may be able to make more dovish appointments to the Fed. Even so, the dollar traded flat to slightly higher after it dropped in the previous session. The dollar index was last up 0.02% at 98.227, while the euro touched its weakest level since August 6 and was last down 0.09% at $1.1631 The three major U.S. stock indexes ended higher. After the closing bell, Nvidia's shares were down about 3% even as the company forecast third-quarter revenue above Wall Street estimates. This year, strong gains for a number of technology-related stocks exposed to AI have helped power major equity indexes to record highs and the results were seen as a test of the AI optimism that has propelled markets. "My takeaway is that these (Nvidia) numbers are not unexpected, nor is this reaction," said Nick Frasse, product manager at Vaneck Associates in New York. "The market has begun to factor in that Nvidia can continue to beat most expectations in spite of headwinds and questions like what they will have to pay to continue selling to China," he added. The company recently agreed to pay the U.S. federal government 15% of the sales it made in China in exchange for undefined export licenses. Technology shares, including several AI leaders, with investors pointing to some signs of caution emerging in the sector. The Dow Jones Industrial Average (.DJI), opens new tab rose 147.16 points, or 0.32%, to 45,565.23, the S&P 500 (.SPX), opens new tab added 15.46 points, or 0.24%, to 6,481.40 and the Nasdaq Composite (.IXIC), opens new tab gained 45.87 points, or 0.21%, to 21,590.14. European stocks rebounded slightly from the previous day's decline, with investors monitoring political risks in France. Concerns over a potential collapse of French Prime Minister Francois Bayrou's government next month sparked a selloff of French assets on Tuesday. MSCI's gauge of stocks across the globe (.MIWD00000PUS), opens new tab gained 0.32 points, or 0.03%, to 953.04. The pan-European STOXX 600 (.STOXX), opens new tab index rose 0.1%. Market watchers interpreted Fed Chair Jerome Powell's comments at the Fed's annual Jackson Hole symposium last week as indicating interest rate cuts could be on the way. Fed funds futures traders are pricing in 84% odds of a cut in September, according to the CME Group's FedWatch Tool. But the outlook for U.S. interest rates will still likely depend on labor market strength and inflation trends. The two-year note yield was last at 3.625%, down around 5 basis points on the day. The benchmark 10-year note yield fell to 4.236%, the lowest since August 14. The yield curve between two-year and 10-year notes was last at 61.3 basis points after reaching 63.5 basis points, the steepest since April 22. Oil gained on a larger-than-expected drop in U.S. crude inventories. U.S. crude futures rose 90 cents to settle at $64.15 a barrel and Brent futures gained 83 cents to settle at $68.05. Spot gold rose 0.12% to $3,396.34 an ounce. Reporting by Caroline Valetkevitch in New York; Additional reporting by Suzanne McGee, Karen Brettell, Yoruk Bahceli, Ankur Banerjee and Dhara Ranasinghe; Editing by Richard Chang, Nia Williams and Jamie Freed Our Standards: The Thomson Reuters Trust Principles., opens new tab

S&P 500 futures fall from record as Nvidia declines following earnings: Live updates

In extended trading, shares of Nvidia fell nearly 3%, even after its second-quarter results beat expectations. Nvidia makes up about 8% of the S&P 500, per FactSet. Chip stocks also came under a bit of pressure following the artificial intelligence bellwether's results, as AMD, Taiwan Semiconductor and Broadcom each fell 1% in sympathy. "The negative stock reaction feels like a bit of an incorrect knee-jerk reaction," David Wagner, head of equity at Aptus Capital Advisors, said, adding that investors should be "buying the pullback." "The company is still growing over 50% on their guidance at a $50B quarterly revenue run rate - that's remarkable, even for the current valuation," he said. Notably, Nvidia said there were no sales of H20 chips to China during the quarter, nor did the company assume any shipments in its guidance. The White House said earlier this month that it's still working out the "legality" of its 15% export tax on Nvidia and AMD. "That's important because that's just an unknown. Do they actually get that license for the H20 and start making sales?" Art Hogan, chief market strategist at B. Riley Wealth Management, told CNBC. "Not putting anything into the Q3 guide means that there's more upside potential if, in fact, they get the license for the H20 into China." To be sure, Hogan also said that he believes the AI boom is still in "the very early innings." He thinks that overall, the market will "breathe a sigh of relief" on Thursday, with investors thinking "Nvidia is still the king of the artificial intelligence revolution" after CEO Jensen Huang "does another masterful job of explaining what we should be looking for moving forward." The market is coming off a winning session Wednesday as traders awaited the chipmaker's results. The S&P 500 and the Nasdaq Composite similarly rose around 0.2%, while the Dow Jones Industrial Average advanced 0.3%. The market is on pace for a winning month as well following Wednesday's moves, as the S&P 500 and the Nasdaq are each up more than 2%, while the 30-stock Dow is up more than 3% in the period. Investors have been shrugging off threats to the Federal Reserve's independence from the Trump administration after President Donald Trump told Fed Board Governor Lisa Cook that she's fired earlier this week, a move that Cook plans to legally challenge. On Wednesday, Trump's top economic adviser, Kevin Hassett, said that Cook should go on leave from the central bank even with her plans to file a lawsuit.

The S&P 500 hit an all-time high just before Nvidia earnings

The S&P 500 rose 0.2%, good enough to nudge the benchmark index past the record high it set two weeks ago. The Dow Jones Industrial Average rose 0.3% and the Nasdaq composite closed 0.2% higher. Technology companies led the way higher, outweighing declines in communication services and other sectors. After the market closed, Nvidia reported quarterly earnings and revenue that topped Wall Street analysts' forecasts, though the company noted that sales of its artificial intelligence chipsets rose at a slower pace than analysts anticipated. The stock fell 3.2% in after-hours trading after having slipped 0.1% during the regular session. Investors consider Nvidia a barometer for the strength of the boom in artificial intelligence because the company makes most of the chips that power the technology. Its heavy weighting also gives Nvidia outsized influence as a bellwether for the broader market. "Saying this is the most important stock in the world is an understatement," said Jay Woods, chief global strategist at Freedom Capital Markets. "The stock's average move after an earnings release is plus or minus 7.4%, so just an average move will make an impact on the entire market." Several big software companies -- CrowdStrike Holdings, ServiceNow, Palo Alto Networks, Intuit and Salesforce -- rose ahead of the Nvidia results. The stocks have been mostly in the red so far this quarter amid worries that AI is going to make software creation much easier at the expense of big software companies' competitive edge. Cracker Barrel shares climbed 8% after the restaurant company scrapped plans to change its logo following an uproar on social media that even drew a comment from President Donald Trump. Shares in several companies rose after they reported quarterly results that topped analysts' forecasts. Department store chain Kohl's vaulted 24% and database platform company MongoDB surged 38%. Both companies also raised their full-year guidance. J.M. Smucker slid 4.4% after the jelly and jam maker's latest quarterly snapshot fell short of analysts' estimates. Among other stocks that lost ground: doughnut shop chain Krispy Kreme, which fell 3.5%, and Paramount Skydance, which dropped 6.5% for the biggest decline among S&P 500 companies. Treasury yields mostly fell in the bond market. The yield on the 10-year Treasury slipped to 4.24% from 4.26% late Tuesday. Crude oil prices rose. European markets finished mostly lower and Asian markets closed mixed overnight. Trading on Wall Street is off to an uneven start this week following big gains last week on hopes for interest rate cuts from the Fed. Markets have been subdued after Trump escalated his fight with the central bank by trying to fire Federal Reserve Governor Lisa Cook. Cook's lawyer said she'll sue Trump's administration to try to stop him. Trump has been feuding with the central bank over its cautious interest rate policy. The Fed has held rates steady since late 2024 over worries that Trump's unpredictable tariff policies will reignite inflation. Trump has also threatened to fire Fed Chair Jerome Powell, often taunting him with name-calling. Still, he is only one of 12 votes that decides interest rate policy. For now, the situation isn't expected to have a major impact on the Fed's near-term policy. The two-year Treasury yield, which closely tracks expectations for Federal Reserve action, dropped to 3.62% from 3.68%. Traders are still betting the Fed will trim its benchmark interest rate at its next meeting in September. Traders see an 90.3% chance that the central bank will cut the rate by a quarter of a percentage point, according to data from CME Group. "It's kind of a foregone conclusion from the market that we're going to get the September interest rate cut," said Jed Ellerbroek, portfolio manager at Argent Capital Management. "The bigger question is probably 'What's after that?' " The Federal Reserve cut its benchmark interest rate in late 2024 after spending the last several years fighting rising inflation by raising rates. It managed to mostly tame inflation and avoided having those higher rates stall economic growth, thanks largely to strong consumer spending and a resilient job market. The Fed hit the pause button heading into 2025 over concerns that higher tariffs imposed by Trump could reignite inflation. Lower interest rates make borrowing easier, helping to spur more investment and spending, but that could also potentially fuel inflation. However, concerns are deepening over the jobs market. Economic data is relatively light this week until Friday, which will bring another update on inflation: the U.S. personal consumption expenditures index. Economists expect it to show that inflation remained at about 2.9% in July, compared with a year ago. Businesses have been warning investors and consumers about higher costs and prices because of tariffs. Steep tariffs placed by the Trump administration on India over Russian oil purchases took effect Wednesday, bringing the combined tariffs imposed on the U.S. ally to 50%. All told, the S&P 500 rose 15.46 points to 6,481.40. The Dow added 147.16 points to 45,565.23, and the Nasdaq climbed 45.87 points to 21,590.14.

S&P 500 notches record close; traders turn to Nvidia results

The S&P 500 achieved a record high close ahead of Nvidia's quarterly results, a key event testing the AI rally's valuation. While Nvidia's stock dipped slightly, its significant S&P 500 weighting makes its financial performance crucial. Investors are also monitoring potential interest rate cuts and political developments, including Trump's attempt to replace a Federal Reserve Governor. The S&P 500 notched a record high close on Wednesday ahead of quarterly results from Nvidia, Wall Street's most closely watched event this week, which will test the rally that has pushed valuations of AI-related companies to levels that some investors view as too high. Shares of Nvidia, the world's most valuable company and the leading supplier of cutting-edge AI processors, bounced between gains and losses before ending down 0.1% ahead of the report, due after the market closes. With Nvidia making up about 8% of the S&P 500, its financial results affect vast numbers of Americans who use index investment funds to save for retirement. "Nvidia is going to produce humongous revenue gains over the next nine months, on top of an already humongous revenue base," said Jed Ellerbroek, portfolio manager at Argent Capital. "Investors should prepare themselves for a world where Nvidia is a double-digit percentage of the S&P 500." Shares in tech and AI heavyweights were mixed, with Microsoft gaining nearly 1% and Meta Platforms dipping almost 1%. They, along with Alphabet and Amazon, are among Nvidia's biggest customers. Enthusiasm for companies related to AI has fueled big gains in technology stocks. The S&P 500 now trades at over 22 times expected earnings, its highest price-to-earnings ratio in four years, according to LSEG. Concerns about the pace of the AI rally increased last week after OpenAI CEO Sam Altman warned of a potential AI bubble. Nvidia options implied a roughly 6% swing for the shares in either direction following the results. Investors will closely watch the impact of the Sino-U.S. trade war on Nvidia's China business earlier this year, along with the effect on forecasts from its recent revenue-sharing deal with the U.S. government. The S&P 500 climbed 0.24% to end the session at 6,481.40 points, exceeding its previous record high close on August 14. The Nasdaq gained 0.21% to 21,590.14 points, while the Dow Jones Industrial Average rose 0.32% to 45,565.23 points. Eight of the 11 S&P 500 sector indexes rose, led by energy, up 1.15%, followed by a 0.48% gain in information technology. Investors were also watching for developments related to U.S. President Donald Trump's attempt to fire Federal Reserve Governor Lisa Cook, a move likely to face legal challenges. If Trump succeeds, he would nominate a replacement to the central bank's board who could be expected to back his policy preferences, challenging the central bank's independence. Investors are pricing in a 25-basis-point interest-rate cut in September, according to data compiled by LSEG, with most big brokerages also leaning in that direction. New York Federal Reserve Bank President John Williams said on CNBC it is likely interest rates can fall at some point but policymakers need to see upcoming economic data to decide if a rate cut is appropriate at the Fed's September meeting. MongoDB soared 38% after the software-maker raised its annual profit forecast. J.M. Smucker fell 4.4% after the Jif peanut butter maker missed first-quarter profit estimates. Advancing issues outnumbered falling ones within the S&P 500 by a 2.2-to-one ratio. The S&P 500 posted 28 new highs and 1 new lows; the Nasdaq recorded 127 new highs and 35 new lows. Volume on U.S. exchanges was relatively light, with 14.0 billion shares traded, compared to an average of 16.9 billion shares over the previous 20 sessions.

S&P 500 notches record close; traders turn to Nvidia results

STORY: U.S. stocks ended higher on Wednesday, with the Dow adding about a third of a percent, the S&P 500 gaining roughly a quarter of a percent to close at a record high, and the Nasdaq ticking up about two-tenths of a percent. Investors were laser-focused on earnings from Nvidia after the market close, which forecast third-quarter revenue above Wall Street estimates helped by robust demand for its artificial intelligence chips from cloud providers. Shares of the chip maker, however, fell in extended trading. Rob Haworth, senior investment strategy director at U.S. Bank Asset Management Group, said that despite periodic pullbacks among AI-related stocks, they remain the market's main drivers. "Artificial intelligence is a really important investment theme for this market, and it's almost a secular one in that we've seen so much investment. And that investment continues, and it's broadening out, right? It's no longer just the people creating the software or creating the generative AI engines. It's into data centers, power utility companies, right? How and into how they are used. So this is a trend that looks like it's here to continue." Shares of tech and other AI heavyweights were mixed Wednesday, with Microsoft gaining nearly 1% and Meta Platforms dipping almost 1%. Among other movers, MongoDB soared 38% after the software-maker raised its annual profit forecast. And shares of J.M. Smucker fell nearly four-and-a-half percent after the Jif peanut butter maker missed first-quarter profit estimates.