Major U.S. stock indexes finished little changed Wednesday as investors weighed a 3.7% inflation reading, higher Treasury yields and slower consumer spending while awaiting Nvidia’s closely watched earnings report after the closing bell.
By yourNEWS Media Newsroom.
U.S. stocks were nearly flat Wednesday as investors absorbed a slightly hotter-than-expected inflation report, higher Treasury yields and fresh economic growth data while holding back on major moves ahead of quarterly results from Nvidia.
The S&P 500 slipped less than 0.1%, leaving the benchmark index close to the record high it established earlier this month.
The Dow Jones Industrial Average declined 0.2%, while the technology-heavy Nasdaq composite fell 0.1%.
Trading remained subdued despite movement in several individual stocks, as Wall Street focused on Nvidia’s earnings announcement scheduled for after the market closed.
The chipmaker has become the most valuable publicly traded company in the United States as demand tied to artificial intelligence drove extraordinary growth in its revenue and profits.
That prominence means Nvidia’s quarterly results and its outlook for future sales can influence sentiment across the broader market, particularly among technology and artificial-intelligence stocks.
Expectations surrounding the company remain elevated.
AI-related shares have become more volatile after years of sharp gains, with investors questioning whether valuations climbed too quickly and whether demand for advanced semiconductor chips can continue at its recent pace if artificial intelligence ultimately produces less revenue for businesses than anticipated.
Nvidia’s forecast for upcoming revenue is therefore expected to receive particular attention.
Strong corporate earnings have been one of the primary forces supporting the U.S. stock market’s advance to record levels this year, and several companies reporting Wednesday produced large moves.
Abercrombie & Fitch surged 31.7% after the retailer reported quarterly profit exceeding analysts’ expectations.
The company also raised its full-year earnings outlook and increased its forecast for the amount of cash it expects to return to investors through share repurchases.
J.M. Smucker gained 4% following stronger-than-expected spring results.
The company, which sells products including Folgers coffee and Smucker’s jams, also increased its full-year profit forecast.
Intuit moved in the opposite direction.
Shares of the company behind TurboTax, Credit Karma and QuickBooks dropped 3.9% even though its latest quarterly profit exceeded analysts’ projections.
Investors instead focused on Intuit’s outlook for its upcoming fiscal year. The company projected profit growth of nearly 25%, a rate that nevertheless came in below analysts’ expectations.
Meta Platforms gained 1.4% following an agreement to pay $17 billion and introduce additional child-safety measures on Facebook and Instagram.
The agreement ends a landmark trial involving allegations of teen social media addiction and resolves claims brought by states across the country.
Economic data provided another major influence on Wednesday’s session.
The Federal Reserve’s historically preferred inflation measure registered an annual rate of 3.7% last month.
That was unchanged from June but slightly above the 3.6% rate economists had forecast, according to FactSet.
The figure remains well above the Federal Reserve’s 2% inflation target.
Consumer spending, the largest component of the U.S. economy, also showed slower growth.
At the same time, a revised government estimate showed the overall economy expanded at a 1.5% annual rate during the spring.
That was unchanged from the government’s initial estimate.
The combination of persistent inflation and continued economic growth helped push Treasury yields somewhat higher.
The yield on the benchmark 10-year Treasury note moved between gains and losses during the session before rising to 4.67%, compared with 4.64% late Tuesday.
Bond yields have been particularly volatile in recent months.
Treasury yields climbed sharply through the summer amid concerns about persistent inflation, the rapidly growing U.S. government debt burden and other pressures affecting the bond market.
The rise became significant enough that the U.S. Treasury Department unexpectedly announced an intervention in the bond market last week, although analysts have cautioned that the measure may have a limited effect.
Wednesday’s inflation figures did little to alter investor expectations for Federal Reserve policy.
Traders continued to assign a nearly three-in-four probability that the central bank will raise the federal funds rate at least once before the end of 2026, according to CME Group data.
Higher interest rates can restrain inflation by slowing borrowing and economic activity, but they can also put pressure on stocks and other investments by increasing financing costs and making bonds more attractive relative to equities.
Oil prices, another major contributor to inflation this year, continued their recent retreat but remained volatile because of uncertainty surrounding the conflict with Iran and access to the Persian Gulf.
Brent crude, the international benchmark, fell as low as $84.56 per barrel Wednesday before recovering much of the decline.
It was most recently trading at $87.17 a barrel, down 0.1% for the day.
That remains substantially below the approximately $94 level recorded at the end of last week.
Oil markets have been swinging as traders assess when tankers will again be able to move freely out of the Persian Gulf amid the continuing war with Iran.
The recent decline in crude prices could help relieve some inflationary pressure if it persists, although Wednesday’s broader inflation report showed that price growth remains elevated.
Overseas markets offered no consistent direction.
European stock indexes were mixed, while major Asian markets generally finished stronger.
South Korea’s Kospi rose 1%, one of the region’s larger gains, while Japan’s Nikkei 225 advanced 0.6%.
For U.S. investors, however, Wednesday’s modest index moves reflected a market largely waiting for its next major catalyst.
Inflation remained above both economists’ expectations and the Federal Reserve’s target, Treasury yields moved higher and consumers showed signs of slowing spending, but none of those developments produced a dramatic change in the outlook for monetary policy.
Attention instead shifted toward Nvidia, whose earnings and revenue forecast could determine whether the artificial-intelligence trade that helped propel Wall Street to records receives another boost or faces renewed questions about whether years of extraordinary growth can continue.
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