Stock market today: Dow ends higher as tech regains momentum; Nvidia eyed

August 23, 2023 4:28 PM EDT -- The Dow closed higher Wednesday, driven by tech as optimism builds ahead of Nvidia’s quarterly results due later today.

The Dow Jones Industrial Average climbed 0.5%, 184 points, Nasdaq rose 1.6%, and the S&P 500 rose 1%.

Tech rallies as focus shifts to Nvidia

Big tech stocks rallied just ahead of Nvidia’s quarterly results that are expected to hold sway on sentiment in the broader sector.

NVIDIA Corporation (NASDAQ: NVDA), which was up more than 2% adding to gains of 220% this year, has been dubbed the “golden child” of AI, driven by a surge in AI applications that has bolstered chip demand.

Meta Platforms Inc (NASDAQ: META), meanwhile, also racked up gains rising more than 3% after Bank of America reiterated its buy on the stock

Peloton plummets on wider loss, downbeat guidance

Peloton Interactive Inc (NASDAQ: PTON) said it no longer expects to remain cashflow positive in the two upcoming quarters after the connected fitness equipment maker reported a wider-than-expected loss following a slump in subscribers. Its shares fell nearly 23% to close at an all-time low.

The company attributed the cash burn in the coming quarters to bike recall costs that exceeded expectations, and plans to boost marketing spend to turn the tide in waning demand.

Footlocker slumps, Abercrombie thrills on earnings stage

Foot Locker Inc (NYSE: FL) terminated its dividend and cut its outlook for the second straight quarter after the athletic retailer’s quarterly revenue fell short of Wall Street estimates.

The profit warning comes as demand continued to soften in July, the company said, as price-sensitive consumers are feeling the squeeze from inflation.

Nike Inc (NYSE: NKE), which is a major supplier of merchandise to Footlocker, fell more than 3%

Abercrombie & Fitch Company (NYSE: ANF), however, jumped 23%, bucking the trend lower after reporting a better-than-expected quarter and lifting its annual guidance on performance.

The high fashion retailer’s results were underpinned by accelerating growth for its Abercrombie brands that boosted sales and margin.

Treasury yields retreat following recent rally

Treasury yields fell sharply from recent highs as investors trimmed their bearish bets on bonds with just days to go until Federal Reserve Jerome Powell takes center stage at the Jackson Hole symposium on Friday.

Chair Powell is also likely to reiterate the possibility of a soft landing, Stifel says, and likely to address the scenario of an uptick in inflation.

Investors will likely be on the lookout for clues as to “how will Fed officials respond or alter their policy pathway in the face of an upturn or a meaningful upturn in inflation,” Stifel added.

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