As retail earnings continue to disappoint, all eyes are on Nvidia as investors await their upcoming results, adding further uncertainty to the current state of US stocks.
Stocks fell on Tuesday, signaling a pause in the November rally as investors awaited results from AI chipmaker Nvidia (NVDA) and the release of Federal Reserve minutes. As of mid-morning trading, the benchmark S&P 500 (^GSPC) dipped around 0.4%, after the stock gauge closed at its highest level since August. The Dow Jones Industrial Average (^DJI) and tech-heavy Nasdaq Composite (^IXIC) also fell, dropping roughly 0.3% and 0.9%, respectively.
Retail earnings disappointed with shares of companies like Lowe’s (LOW), Best Buy (BBY), American Eagle Outfitters (AEO), and Khol’s (KSS) dropping on Tuesday as a pullback in consumer spending clouded forecasts and registered a hit to sales.
Looking ahead, eyes will be on Nvidia’s quarterly report for an update on the fundamentals behind the AI hype cycle after the company’s stock notched at a record close on Monday. Expectations are high as the chip giant has become the face of the 2023 AI story, after its last earnings spurred a rally in stocks.
Meanwhile, the OpenAI drama is still center stage after Microsoft’s (MSFT) CEO hinted he was open to Sam Altman rejoining the ChatGPT maker. Investors are also watching for minutes from the Fed’s last rate-setting meeting, amid a debate over whether the rate-cut optimism that has powered the stock rally is overdone. In a holiday-shortened week light on economic data, the comments will be closely scrutinized for any hints to policymakers’ thinking.
The OpenAI drama continued on Tuesday as investors of the ChatGDPT maker said they want to lure ousted Sam Altman back to the company. Microsoft (MSFT) CEO Satya Nadella hinted he was open to the idea, despite the company recruiting Altman to lead an in-house AI division. Still, certain stipulations would have to be met, including the resignation of the startup’s current board, along with a change to OpenAI’s governance.
Retail earnings continued to be disappointing with a pullback in consumer spending clouding forecasts, leading companies like Lowe’s (LOW), Best Buy (BBY), American Eagle Outfitters (AEO), and Khol’s (KSS) to drop in trading. Conversely, Dick’s Sporting Goods saw shares surge after reporting strong earnings amidst rising demand for sports gear. Amid these developments, stock fell at open on Tuesday, with the Nasdaq Composite (^IXIC) leading the early morning declines.