4:10pm: Stocks mixed at the close
The Nasdaq and the S&P 500 struggled on Monday, with both stock indexes finishing the session in the red.
The Nasdaq led the declines driven by a 2.3% drop in chipmaker Nvidia, shedding 0.9% at 17,725 points.
The S&P 500 was down 0.3% at 5,616 points while the Dow Jones gained 0.2% at 41,240 points.
3:00pm: Dow touches intraday high
Stocks put in a mixed performance on Monday afternoon.
The Dow Jones Industrial Average stayed slightly above the flatline after briefly hitting an intraday record, while the S&P 500 dipped 0.3% and the Nasdaq Composite fell 0.7%, dragged down by declines in Nvidia and Tesla, with Tesla shares dropping over 3%.
"It’s not often you can tout that one company is the most important stock in the market, but it is not a stretch here," commented Jay Woods, chief global strategist at Freedom Capital Markets (NASDAQ:FRHC).
"Given that it's the last of the 'Magnificent 7' to report and it has so much of a weighting in the most important sectors in the world, it’s impact could cause tremors in the entire market."
12:05pm: Temu owner PDD slumps
Shares of PDD Holding plunged post-earnings, down more than 30.2% at about US$98 after the parent company of discount online retailer Temu reported quarterly revenue below analyst estimates.
For the quarter, revenue was 97.06 billion yuan (US$13.64 billion), missing estimates of 100 billion yuan ($US14.02 billion).
PDD Holdings VP of Finance Jun Liu said that looking ahead the company’s revenue growth would “inevitably face pressure due to intensified competition and external challenges.”
“Profitability will also likely to be impacted as we continue to invest resolutely,” Liu said.
10:59am: July housing and Fed surveys awaited
It is a quieter start to the week, with data- and news-flow relatively light.
Looking at the week ahead, UBS analysts expect minimal changes to the previously reported 2.8% Q2 real GDP growth, with income revisions reflecting new Q1 data from the Quarterly Census of Employment and Wages (QCEW).
UBS forecasts a 0.15% increase in both core and headline PCE prices for July, maintaining the core inflation rate at 2.64% year-over-year.
The Conference Board’s consumer sentiment index is predicted to show a slight improvement, while the final University of Michigan sentiment estimate is likely to remain largely unchanged.
UBS also notes that the release of regional Fed surveys and July housing data will continue, though the schedule of Federal Reserve speeches is expected to be light following the Jackson Hole symposium.
9:50am: Stocks gain at open
The Dow Jones rose at Monday’s open as the Federal Reserve's signals of imminent interest-rate cuts bolstered market optimism, pushing the S&P 500 near its all-time closing high.
Just after 9:30am, the Dow was up around 0.5% at 41,369 points, while the S&P 500 was slightly ahead at 5,643 and the Nasdaq slipping 0.2% at 17,841.
Markets are focusing on Nvidia's earnings report Wednesday, but upcoming economic data, including the PCE index and second-quarter GDP, could influence future Fed decisions.
The markets are giving back some of Friday’s moves as the new trading week gets underway, Michael Brown, senior research strategist at Pepperstone noted.
“Confirmation that the first cut will be delivered in four weeks’ time has kept the bulls in control of the equity space, with the S&P inches away from a fresh record high,” Brown commented.
“The path of least resistance continues to lead higher, with dips remaining buying opportunities.”
In other markets, the US Treasury 10-year yield is at 3.82%, gold futures hit $2,560/ounce, and WTI crude surged 2.9% to $77/barrel amid rising Middle East tensions.
8:00am: Markets rally on Fed's dovish signal
US stocks are poised to resume their rally, driven by the Federal Reserve's indication of imminent interest-rate cuts and anticipation surrounding Nvidia's upcoming earnings report.
Ahead of the opening bell on Monday, the S&P 500 and Dow Jones futures inched up around 0.2% and 0.1% respectively, while Nasdaq futures remained flat after a strong week of gains.
Markets are nearing record highs, with the Fed signaling potential rate cuts in September, though the exact timing and extent remain uncertain.
Nvidia's earnings, set for Wednesday, are seen as a critical test for the AI-driven market surge. Investors are cautious, knowing that any disappointment could impact the broader market, especially as other tech giants have posted mixed results.
“The importance of Nvidia's results cannot be underestimated, as they will serve as a barometer for gauging the state and future expectations of the tech sector,” Antonio Ernesto Di Giacomo, senior market analyst at XS.com wrote Monday.
“Depending on the figures and forecasts the company discloses, we could see a significant impact on market behavior, reinforcing confidence in AI as a growth driver or sowing further doubts among investors.”
Nvidia's performance is key in determining whether the enthusiasm around AI continues to bolster the market or if a correction is on the horizon.
Elsewhere, crude oil bulls are focused on reports that Israel has declared a 48-hour state of emergency following a pre-emptive strike on Hezbollah targets in southern Lebanon. This action is in anticipation of potential retaliation for last month’s assassination of Hezbollah’s military chief.
WTI oil prices gained nearly 2.9% on Monday, while Brent was up 2.8%.