Wall Street’s main indexes have opened mostly flat as investors keep to the sidelines ahead of AI chip leader Nvidia’s quarterly results and the Federal Reserve’s policy meeting minutes later in the day.
All eyes will be on whether semiconductor bellwether Nvidia’s first-quarter results, due after market close, can meet sky-high expectations and sustain bumper gains recorded by the company’s shares and other AI-related stocks.
Nvidia has emerged as the third-largest US company by market value following a more than 92 per cent surge in its shares this year and an over threefold jump in 2023.
“The market is looking for a new catalyst, and maybe that will be Nvidia. We’ve come off of a very strong earnings season, but at current levels, you could be subject to some sort of a pullback on any disappointment,” said Peter Cardillo, chief market economist at Spartan Capital Securities.
The company’s shares lost 0.6 per cent, reversing pre-market gains.
Wall Street’s recent bull run has carried all three major indexes to record highs this month, driven by a strong earnings season as well as renewed hopes for interest-rate cuts and a so-called soft landing for the US economy.
The Nasdaq briefly touched a fresh record high after markets opened, before retreating.
The tech-heavy index and the benchmark S&P 500 both closed at all-time highs on Tuesday.
Analysts polled by Reuters see the S&P 500 closing the year near current levels at 5,302 but warned the index’s strong run means it is at risk of a correction in coming months.
Investors are also keenly awaiting minutes from the US central bank’s latest policy meeting, due at 2pm ET, for more clarity on the timing of a rate cut.
Several policymakers have reiterated the need to wait for more signs of easing inflation before cutting rates.
“The Fed’s data-dependent over the next two months or so but I do see a little bit of a shift in terms of perhaps members warming up to a rate cut possibly in the fourth quarter or the very latter part of the third quarter,” Cardillo said.
Traders are pricing in near 68 per cent odds of the Fed cutting rates in September by at least 25 basis points, according to CME’s FedWatch Tool.
In early trading on Wednesday, the Dow Jones Industrial Average was down 27.67 points, or 0.07 per cent, at 39,845.32, the S&P 500 was down 0.82 points, or 0.02 per cent, at 5,320.59, and the Nasdaq Composite was up 11.95 points, or 0.07 per cent, at 16,844.57.
Retailer Target dropped 8.6 per cent on weak quarterly results and second-quarter forecasts for profit and comparable sales that were below expectations.
Chip maker Analog Devices jumped 7.6 per cent after forecasting third-quarter revenue above expectations while US-listed shares of PDD Holdings soared 3.6 per cent as the e-commerce platform operator beat first-quarter revenue estimates.
Analog’s gains helped lift the S&P 500’s information technology sector 0.3 per cent while the energy sector led sectoral declines.
Declining issues outnumbered advancers for a 1.69-to-1 ratio on the NYSE and a 1.08-to-1 ratio on the Nasdaq.
The S&P index recorded 34 new 52-week highs and five new lows while the Nasdaq recorded 53 new highs and 56 new lows.
Source Agencies
