Advertisement
U.S. stocks moved mostly higher on Thursday morning as traders looked at fresh economic data and reacted to earnings from artificial intelligence giant Nvidia.
By 9:35 a.m. ET, the Dow Jones was flat, the S&P 500 added about 0.2%, and the Nasdaq gained 0.4%. All three major indexes are still on track for strong monthly gains. The S&P 500 and Nasdaq were already up more than 2% for August, while the Dow had gained more than 3%.
Nvidia shares dropped even after the company reported better-than-expected earnings and forecasted strong revenue for the next quarter. The decline came because its data center sales missed expectations, and investors grew cautious about its China outlook. Nvidia also said it had no sales of its H20 chips to China and does not expect shipments in upcoming quarters.
This weighed on other chip stocks too, with AMD, Taiwan Semiconductor, and Broadcom all slipping. In tech earnings, CrowdStrike fell after giving weak guidance, while Snowflake surged after raising its revenue forecast.
Outside of tech, Brown Forman, the maker of Jack Daniel’s, topped sales estimates thanks to strong demand for spirits and ready-to-drink cocktails. Bath & Body Works disappointed with weaker profit, hurt by higher costs and softer consumer spending. Dollar General, however, lifted its sales and profit outlook, citing strong demand from shoppers looking for affordable options during inflationary times.
On the economic front, U.S. GDP grew by 3.3% in the second quarter, stronger than the earlier estimate of 3%. This came after the economy shrank slightly in the first quarter. The better growth data, along with recent comments from Federal Reserve officials, boosted hopes that an interest rate cut could come as soon as September. Fed Governor John Williams said all meetings are “live” and that the Fed will keep watching incoming data closely.
Looking ahead, investors are waiting for Friday’s PCE price index report, which is the Fed’s preferred inflation measure, as well as next week’s monthly jobs report.
In energy markets, oil prices slipped. Brent crude was down 0.4% to $67.19 a barrel, while U.S. West Texas Intermediate dropped 0.4% to $63.92. This came even after government data showed a bigger-than-expected fall in U.S. crude inventories last week. The decline hinted at strong demand ahead of the Labor Day holiday, but traders expect consumption to slow down as the summer driving season comes to an end.