Stock Market Today: Wall Street Hangs Near Its Records After an 8-Day Winning Streak

Economy

By Associated Press

Published 6 months ago on

August 20, 2024

Wall Street maintains near-record levels following an eight-day winning streak, with the S&P 500 just 1.2% below its all-time high. (AP/Peter Morgan)

Nvidia's 2.7% drop weighs heavily on the market as it approaches its earnings report next week.
Palo Alto Networks jumps 6.4% after reporting stronger-than-expected quarterly results, helping limit market losses.
Federal Reserve Chair Jerome Powell's upcoming speech at Jackson Hole symposium is anticipated to be the week's financial highlight.

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NEW YORK — U.S. stocks are hanging near their record heights on Tuesday following an eight-day winning streak.

The S&P 500 was 0.2% lower in morning trading and sitting 1.2% below its all-time high set last month. It has roared back from its scary summer drop, where the index briefly dropped nearly 10% below its record, and is near its first nine-day winning streak in almost two decades.

The Dow Jones Industrial Average was down 29 points, or 0.1%, as of 10:40 a.m. Eastern time, and the Nasdaq composite was 0.5% lower.

Nvidia Weighs on Market as Earnings Approach

Nvidia was the heaviest weight on the market after falling 2.7%. The chip company is one of Wall Street’s most influential stocks because it’s been riding investors’ frenzy around artificial-intelligence technology to become one of the U.S. stock market’s most valuable at more than $3 trillion.

Nvidia has recovered most of its summertime swoon, where its stock dropped more than 20% on worries investors went overboard and took its price too high, but it has remained shaky as it heads into its earnings report scheduled for next week.

Palo Alto Networks and Lowe’s Report Earnings

Palo Alto Networks was helping to limit the market’s losses. The cybersecurity company jumped 6.4% after becoming the latest big business to report stronger profit and revenue for the latest quarter than analysts expected. Companies in the S&P 500 are on track to report their best growth in earnings per share since the end of 2021, according to FactSet.

Lowe’s likewise topped analysts’ forecasts for profit in the spring, but its stock was more restrained. The home improvement retailer said it’s facing a challenging economic backdrop, “especially for the homeowner,” and cut its forecasts for revenue and profit this fiscal year. Its stock fell 0.4%.

Federal Reserve and Interest Rates in Focus

High interest rates have been weighing on the economy after the Federal Reserve hiked them sharply in order to get inflation under control. On Tuesday, Treasury yields were easing ahead of a speech on Friday by Federal Reserve Chair Jerome Powell, one that’s likely to be the week’s highlight for financial markets.

The economic symposium in Jackson Hole, Wyoming, where Powell will be speaking has been home to big policy announcements in the past. Expectations aren’t that high this time around, with nearly everyone already expecting the Fed will begin cutting interest rates next month.

The biggest question is whether the economy needs the Federal Reserve merely to remove the brakes or if it needs an extra boost requiring deeper and faster cuts.

A surprisingly weak report on hiring by U.S. employers last month raised worries the Fed has already kept interest rates too high for too long, but ensuing data on everything from inflation to sales at U.S. retailers helped bolstered optimism.

The yield on the 10-year Treasury fell to 3.83% from 3.87% late Monday.

Airline Merger and Global Market Updates

On Wall Street, the company behind Hawaiian Airlines soared 11.6% after it said its proposed merger with the company behind Alaska Airlines has cleared a major regulatory hurdle. A review period by U.S. antitrust regulators for the deal has passed.

Alaska Air Group slipped 0.2%.

In stock markets abroad, Japan’s Nikkei 225 jumped 1.8% to claw back all of its sharp loss from the day earlier. Japan has been home to some of the world’s most vicious moves for financial markets recently after the Bank of Japan raised interest rates there last month.

That hike triggered waves of selling around the world because it forced many hedge funds and other professional investors to abandon a popular trade all at once, where they borrowed Japanese yen cheaply and invested it elsewhere. That included the worst day for Japan’s stock market since the Black Monday crash of 1987.

But an ensuing assurance from the Bank of Japan on interest rates has helped calm the market, along with the better-than-expected data on the U.S. economy.

Indexes were modestly lower in Europe after a report on inflation for countries that use the euro currency came in as economists expected. They were mixed in Asia.