Stocks slid on Wednesday while investors awaited Nvidia’s highly anticipated earnings report, which could be pivotal in determining whether the AI-fueled rally can maintain its momentum. Following Tuesday’s strong performance fueled by easing tariff concerns, traders have become more cautious in the face of upcoming tech earnings and lingering uncertainty over trade and interest rate policy.
The Dow Jones Industrial Average slipped 0.32%, letting go of some of yesterday’s gains. The S&P 500 declined 0.21%, while the Nasdaq Composite inched lower by 0.06%, weighed by a pullback in some megacap tech names. Despite the muted action, Nvidia’s post-bell report remains the key focus for investors today.
Market Movers:
- Nvidia (NVDA) +0.63%: Shares saw modest gains as investors positioned ahead of the company’s earnings release. The chipmaker, a key player in the AI boom, has beat consensus estimates consistently over the past two years. Wall Street is watching closely to see whether Nvidia can continue delivering blowout results and offer an optimistic forecast despite trade headwinds.
- Abercrombie & Fitch (ANF) +24.6%: AShares soared after the retailer delivered strong quarterly results, boosted by demand across its global brand portfolio. Investors welcomed a top- and bottom-line beat, along with signs that the company is navigating the tariff environment better than expected. The stock’s sharp rally highlights investor appetite for strong execution in the consumer discretionary space.
- GameStop (GME) -6.3%: Shares dropped after the company revealed it had added over $500 million worth of bitcoin to its balance sheet. While the move aligns with recent crypto enthusiasm, investors were concerned by the scale of the investment and the stock's recent dilution from convertible notes. The market’s reaction suggests skepticism around GameStop's long-term strategic direction.
- Macy’s (M) -0.9%: Shares dipped despite narrowly beating first-quarter earnings and revenue expectations. The company trimmed its full-year guidance, citing uncertainty tied to U.S. tariffs and evolving consumer spending habits. Investors appeared unconvinced that the department store chain could maintain momentum due to trade-related cost pressures.
Fed Minutes and Rate Sensitivity in Focus
Later today, the Federal Reserve will release minutes from its most recent policy meeting, offering more insight into how central bankers view inflation, growth, and the impact of fiscal policy. With interest rate expectations largely stable for now, investors are parsing every signal about how long the Fed may hold its current stance.
In the meantime, sectors sensitive to interest rates are under pressure. Utilities led declines among S&P 500 sectors, falling more than 1.3% as Treasury yields crept higher. The yield on the 10-year note edged toward 4.5%, while the 30-year topped 5% again, applying pressure to rate-sensitive names and smaller-cap stocks.
Oil Climbs on Supply Risks
Crude prices rose sharply on Wednesday as traders weighed potential output increases from OPEC+ against rising global supply concerns. West Texas Intermediate crude climbed 2% to trade near $62 per barrel, while Brent crude also moved higher amid heightened geopolitical tension.
Market jitters grew following stalled Russia-Ukraine peace negotiations, raising fears of additional sanctions that could limit Russian oil exports. Meanwhile, OPEC+ is set to meet on Saturday to decide whether to extend or raise production quotas heading into the second half of the year. Analysts expect output hikes but warn that supply disruptions may still dominate near-term pricing.
Looking Ahead
All eyes now turn to Nvidia’s results, which are expected to release after the bell and could set the tone for tech stocks in the weeks ahead. With AI optimism largely priced in, any signs of demand weakness or cautious forward guidance could ripple through broader markets. On the macro front, investors will closely watch the Fed’s meeting minutes and any additional updates on global trade negotiations.
For now, caution prevails—but a blockbuster report from Nvidia could reignite risk appetite in short order.