U.S. stocks were mixed in trading on Monday as investors weighed the imminent arrival of interest rate cuts and headed into a busy week dominated by Nvidia’s ( NVDA ) earnings report.
The Dow Jones Industrial Average (^DJI) briefly touched new intraday records before giving up its gains to move near the flatline. The S&P 500 (^GSPC) fell 0.4%, while the tech-heavy Nasdaq Composite (^IXIC) fell 1% as shares of chip heavyweight Nvidia fell.
Shares of Tesla ( TSLA ) also fell 3%, contributing to losses in the Nasdaq and S&P 500.
Stocks are coming off weekly gains after Chairman Jerome Powell made it clear the Fed is ready to cut rates in September. All major indices have gained more than 1% in the past week.
Markets moved quickly to price in a total of 1% cuts through the end of 2024. But with only three central bank meetings in September, November and December still to come, Wall Street is left wondering when and if. 0.5% reduction is possible.
Now Nvidia is firmly focused on earnings — the key event of the week — which will determine whether the market mood is upbeat. If the chipmaker’s results on Wednesday fail to meet sky-high expectations, it could further dampen the AI trade that drove stock gains — and test the market’s rally from August lows.
A Friday update on Fed policymakers’ favorite inflation gauge, the PCE index, feeds rate-path calculations. A reading of second-quarter gross domestic product is on the floors on Thursday.
Meanwhile, oil prices rose about 3% amid fears of rising Middle East tensions after production shutdowns in Libya and Israel and Hezbollah launched strikes. Global benchmark Brent crude futures (BZ=F) rose to $80.08 a barrel, while US benchmark WTI crude futures (CL=F) settled at $77.19 a barrel.
