Stocks Edge Lower as Nvidia Declines Ahead of Earnings Report
Stocks slipped on Wednesday, pressured by a 2% drop in Nvidia ahead of its highly anticipated earnings release and weaker-than-expected results from Target. Wall Street remained cautious as traders assessed the chipmaker’s potential impact on broader market trends and grappled with ongoing economic and geopolitical concerns.
At 15:21 GMT, the Dow Jones Industrial Average is trading 43076.31, down 192.63 or -0.45%. The S&P 500 Index is at 5860.68, down 56.30 or -0.95% and the Nasdaq is trading 18725.02, down 262.45 or -1.38%.
Broad Market Indices Struggle
The S&P 500 dipped as declines in technology and consumer discretionary sectors weighed on the index. The Nasdaq Composite fell with Nvidia contributing heavily to losses. Meanwhile, the Dow Jones Industrial Average edged lower, dragged by losses in major retail names, including Target.
Nvidia’s earnings report, expected after the close, has garnered significant attention as investors await details on demand for its Blackwell AI chips. The company, valued at $3.6 trillion, has been a key driver of this year’s market rally. Analysts at Wolfe Research cautioned that any disappointing data on AI spending could temper recent bullish sentiment. Nvidia shares fell 1% in morning trading, reflecting market jitters.
Retail Sector Under Pressure
Target plunged 20% after reporting its largest earnings miss in two years and slashing its full-year guidance due to slowing discretionary demand and higher costs. The retailer’s struggles to boost sales, even after significant price reductions, drew a downgrade from Citi to “neutral,” citing market share risks.
The disappointing report rippled through the retail sector. The SPDR S&P Retail ETF declined 1.5%, while major names like Walmart and Costco slipped modestly. Discount retailers bore the brunt, with Dollar Tree, Dollar General, and Five Below shedding over 3% each. Home Depot also lost 1%, compounding broader concerns over consumer spending.
Comcast Gains on Spin-Off News
In a rare bright spot, Comcast rose slightly after announcing plans to spin off its cable networks, including MSNBC and CNBC. The move, expected to take about a year, was first hinted at during the company’s October earnings call. The decision underscores Comcast’s strategy to streamline its business amid evolving media consumption trends.
Market Outlook
Investor sentiment remains fragile, with Nvidia’s results likely to set the tone for the remainder of the week. Any weakness in AI spending could exacerbate the recent pullback in major indices. Additionally, geopolitical concerns and Federal Reserve Chair Jerome Powell’s signals on interest rates have traders wary of further volatility.
In the near term, markets may remain choppy. A strong earnings report from Nvidia could reinvigorate tech stocks, while further weakness in retail or disappointing AI demand would likely amplify selling pressure. Traders should brace for volatility and remain attuned to sector-specific drivers.
