Last week, Wall Street experienced back-to-back weekly gains after Federal Reserve Chairman Jerome Powell gave a speech from Jackson Hole that satisfied investors. Powell hinted at potential interest rate cuts, stating that “the time has come for policy to adjust.” This news led to expectations of 1 percentage point of cuts by the end of the year. The market rallied, with the S & P 500 and Nasdaq both finishing the week up nearly 1.5%.
Top Performers of the Week
TJX Companies emerged as the best-performing stock, gaining over 6.5% following a strong quarterly beat and guidance raise. Similarly, Palo Alto Networks saw a 4% increase in its stock price after delivering robust earnings and a promising outlook. However, Estee Lauder did not meet expectations in the prestige beauty market, resulting in a dip in its stock value.
Nvidia Earnings Preview
One of the most anticipated releases of the upcoming week is Nvidia’s earnings report. The company is set to deliver its fiscal 2025 second-quarter results. Investors are eager to hear about Nvidia’s guidance for the current quarter and the supply and demand dynamics, especially with concerns about a delay in the next-generation Blackwell artificial intelligence chip architecture. Growth in services will also be closely monitored as a driver of future value creation.
Salesforce’s Performance
Salesforce is another key player reporting its fiscal 2025 second-quarter results. After falling short in the previous quarter, Salesforce will aim to provide better results this time around. The enterprise software cohort has been under pressure, and investors are hoping for improved sales and operating margin. Management’s commentary on deal activity will be crucial in determining the company’s future performance.
Before Thursday’s opening bell, Best Buy is expected to issue its fiscal 2025 second-quarter earnings report. The company previously reported solid results, focusing on strong profitability despite slightly lower sales. Investors are looking for insights into the computer hardware upgrade cycle, particularly AI-equipped machines. The post-earnings call will reveal how Best Buy plans to market the new technology to consumers and drive demand for AI devices.
Apart from earnings reports, the week ahead also includes important economic data releases. The government will provide the second look at U.S. economic growth in the second quarter and the latest inflation measure. The personal consumption expenditures (PCE) price index is expected to show a 2.5% year-over-year increase in the headline PCE and a 2.7% rise in the core rate, excluding food and energy prices. The Federal Reserve aims to bring inflation back down to its 2% target, with Powell expressing confidence in the progress towards this goal.
The upcoming week features a series of events, including earnings reports and economic updates. Earnings releases include companies like Abercrombie & Fitch, Chewy, Kohl’s, Nvidia, Salesforce, and Best Buy. Economic data releases such as the gross domestic product (Q2 preliminary) and the personal consumption expenditures (PCE) price index are set to provide insights into the current state of the U.S. economy.
Overall, the market’s reaction to Powell’s speech and the anticipation surrounding major earnings reports will likely drive the direction of Wall Street in the coming week. Investors will closely monitor the performance of key companies and economic indicators to gauge the overall health of the economy and make informed investment decisions.
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