Stock Market Update for the Upcoming Week: Dow at 45,631, S&P 500 Near Record, Nvidia Earnings Loom

Stock Market Update: Fed Pivot, Nvidia Earnings, and Key Data to Shape Upcoming Week

The upcoming trading week opens with Wall Street in rally mode after Federal Reserve Chair Jerome Powell’s Jackson Hole remarks shifted expectations toward a September rate cut. The Dow Jones Industrial Average (^DJI) closed last week at a record 45,631.74, up +1.89% on Friday alone. The S&P 500 (^GSPC) advanced +1.52% to 6,466.91, while the Nasdaq Composite (^IXIC) gained +1.88% after clawing back from midweek declines. The small-cap Russell 2000 outpaced the majors with a +3.3% surge, underscoring renewed appetite for risk as Treasury yields slipped.

The bond market is now pricing 91.5% odds of a September cut, a sharp jump from 70% just hours before Powell spoke. The 10-year Treasury yield (^TNX) ended at 4.26%, while the 30-year (^TYX) settled at 4.89%, reflecting expectations that borrowing costs will soon ease across the economy.

Nvidia Earnings Take Center Stage

The focal point of the week will be Nvidia (NASDAQ: NVDA), with Q2 earnings due Wednesday. Shares closed at $177.99, gaining +1.72% Friday, though still nursing a weekly decline. Analysts expect another record-setting quarter for the AI chip leader, but risks tied to U.S.-China trade tensions are mounting. Nvidia has warned of an $8 billion revenue hit from export restrictions and is now negotiating with the Trump administration to launch a scaled-down Blackwell-based chip for Chinese data centers.

Investors will parse CEO Jensen Huang’s guidance for clarity on Blackwell production timelines and rumors of a Rubin chip delay. With Nvidia commanding a 7.5% weighting in the S&P 500, its results will ripple well beyond semiconductors, shaping sentiment for the entire Nasdaq. Other tech earnings to watch include Marvell (MRVL), Dell (DELL), CrowdStrike (CRWD), Snowflake (SNOW), and Autodesk (ADSK).

Fed Policy, PCE Inflation, and Political Pressure

The July Personal Consumption Expenditures (PCE) Index, the Fed’s preferred inflation gauge, will be released Friday. A softer reading would cement expectations for Powell’s September pivot, while a hotter number could complicate rate-cut bets. June’s PCE ticked higher, but early July data suggests easing pressures.

President Trump remains a wild card for markets. His administration announced plans to take a 10% equity stake in Intel (NASDAQ: INTC), sparking a +5.53% surge in Intel shares to $24.80. The move underscores Washington’s intent to bolster domestic semiconductor capacity, even as Intel struggles to keep pace with rivals AMD (AMD) and Nvidia (NVDA) in AI. Trump has also ramped up public pressure on the Fed, threatening to fire Governor Lisa Cook, injecting further political drama into monetary policy.

Mega-Cap Titans Dominate the S&P 500

The so-called “Ten Titans” — Nvidia (NVDA), Microsoft (MSFT), Apple (AAPL), Amazon (AMZN), Alphabet (GOOG, GOOGL), Meta Platforms (META), Broadcom (AVGO), Tesla (TSLA), Oracle (ORCL), and Netflix (NFLX) — now account for 38% of the S&P 500’s market cap, equivalent to nearly $20.6 trillion. For perspective, that’s double the size of China’s entire equity market at $11.76 trillion.

This level of concentration means index funds tied to the S&P 500 increasingly behave like growth ETFs. For instance, Nvidia’s 7.5% weight vastly overshadows names like Campbell Soup (CPB) at 0.02%. While this dynamic has fueled record returns during the AI-driven rally, it also raises volatility risks — if a handful of mega-caps stumble, the entire index moves with them.

Sector Rotations and Individual Stock Drivers

Friday’s Fed-fueled rally lifted nearly every sector. Financials (XLF) surged +2.1% with JPMorgan (JPM) up +2% to $296.24, while Industrials (XLI) gained +1.8%. Energy (XLE) advanced +3% as WTI crude rose to $63.66/barrel, its highest in weeks.

Tech was mixed: Apple (AAPL) rose +1.27% to $227.76 on reports it may integrate Google’s Gemini AI into Siri. Tesla (TSLA) jumped +6.22% as Chinese rival Nio (NIO) unveiled a new SUV priced at $43,000. Amazon (AMZN) added +3.10%, Meta (META) +2.12%, and Google (GOOG) +3.04%. On the downside, Costco (COST) fell -1.15% and Intuit (INTU) slid -5.03% after soft revenue guidance.

AI Valuations and Market Sentiment

Bubble fears persist in AI. Nvidia trades at 56x earnings, while Palantir (PLTR) exceeds 500x — valuations that echo the late 1990s. MIT research indicates 95% of companies investing in generative AI have yet to realize financial returns, fueling concerns of an overheated trade. Even OpenAI’s Sam Altman has described valuations as “insane.”

Still, history shows that downturns consolidate power among the largest players. Giants like Microsoft (MSFT) and Alphabet (GOOG) could benefit from distressed acquisitions if speculative names collapse. That dynamic reinforces why the Nasdaq and S&P 500 remain tied so heavily to mega-cap performance.

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