Dow Smashes All-time High Before Nvidia Report
2024-08-28
Summary:
The S&P 500 rose on Tuesday, while the Dow Jones hit a record high. Both await Nvidia's quarterly report and upcoming economic data later this week.
The S&P 500 ended higher on Tuesday and the Dow Jones notched a record-high close ahead of a much-anticipated quarterly report from Nvidia and economic data expected later in the week.
Nvidia's shares climbed 1.5% and it was the most-traded company on US stock exchanges, according to LSEG data. The company is viewed as the biggest winner so far from AI technology.
Data on Tuesday showed US consumer confidence rose to a six-month high in August, though consumers also became more anxious about the labour market where sings of weakness has surfaced.
Meanwhile, UBS Global Wealth Management raised the odds of a US recession to 25% from 20%. The Swiss bank also suggested the fundamentals for the broader AI growth story remain intact.
Corporate America's Q2 results in aggregate showed earnings remain resilient, with guidance revisions tracking in line with normal seasonal patterns. UBS expect S&P 500 companies to grow earnings by 11% this year.
Nomura analysts said that tech stocks rose sharply and became very overvalued in April-June due to the excess liquidity-driven market. Some tech companies' earnings reports are not as strong as expected.
Dow continued its rally but we see difficulty in moving further beyond the current level as market may fear volatility resurgence. It will likely retreat towards 50 SMA if a triple top pattern is formed.
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