U.S. Stocks Recover Ahead of Nvidia Earnings, Ending a Four-Day Decline

The US stock market staged a solid comeback on Wednesday, ending its longest stretch of losses since August. The rebound was driven largely by a surge in AI giant Nvidia, as investors positioned themselves ahead of the company’s highly anticipated earnings release scheduled after the closing bell.

By mid-morning in New York, the S&P 500 Index had gained nearly 1%, recovering from four straight losing sessions that dragged the benchmark about 3% below its October high. The Nasdaq 100 Index strengthened by 1.5%, supported by a strong advance in the Magnificent Seven stocks, including major names such as Apple and Meta Platforms.

Nvidia — widely viewed as the most influential stock in the AI sector — climbed 3.2%, partially reversing its nearly 8% decline earlier this month.

Tech and Semiconductor Stocks Drive Market Momentum

Strong Performance Across S&P 500 Sectors

Eight of the 11 S&P 500 sectors recorded gains, with communication services and technology leading the upward push — highlighting continued enthusiasm for AI-powered stocks and the broader tech market.

The Philadelphia Semiconductor Index advanced by 2.7%, boosted by strong moves from major chipmakers Broadcom and Lam Research, both rising more than 4%.

Mixed Performances from Individual Companies

• Target Corp. slipped 0.6% after slightly reducing its profit outlook for the year.
• Lowe’s rallied nearly 3% after reporting earnings that exceeded expectations, supported by rising online sales and increased spending from professional contractors.

Nvidia Earnings: The Week’s Biggest Market Catalyst

AI Enthusiasm Faces a Major Test

After several volatile weeks that pushed the S&P 500 down roughly 3% for the month, investors are now turning their focus to the AI frenzy that has fueled much of the market’s gains in recent years. Traders believe Nvidia’s earnings report could help stabilize market sentiment and address growing concerns about the pace of AI-related spending.

According to market strategist Tom Essaye, Nvidia’s earnings are viewed as “the most important catalyst of the week”, with any disappointing results likely to increase selling pressure across the tech sector and weigh on broader risk assets.

Potential Market Impact

As the company now represents nearly 8% of the S&P 500’s total weighting, Nvidia’s performance has the power to influence the entire index. Analysts say that only the upcoming Dec. 10 Federal Reserve meeting is expected to generate more market volatility in the weeks ahead.

Options traders are pricing in a 7% swing in either direction for Nvidia stock, while projections suggest the S&P 500 could move more than 1% following the announcement.

Economic Data and Fed Minutes Add to Market Tension

Delayed US Jobs Report Arrives Thursday

Investors are also preparing for the long-delayed US September jobs report, postponed due to last month’s government shutdown. This data will help shape expectations around how quickly the Federal Reserve may continue cutting interest rates.

Fed Meeting Minutes Also in Focus

On Wednesday afternoon, the Fed will release its October meeting minutes, offering additional clues on policymakers’ views regarding inflation, employment, and the pace of future rate adjustments.

Major Movers Beyond the Big Indexes

Notable Stock Reactions

Several individual companies saw dramatic price swings:

• Agios Pharmaceuticals plunged 45% after mixed results in its Phase 3 trial for a sickle-cell treatment.
• La-Z-Boy jumped 19% after reporting second-quarter sales and profits that beat expectations.
• Plug Power dropped 13% following news of a $375 million private offering of convertible notes due in 2033.
• SEMrush Holdings skyrocketed 75%, marking its biggest intraday gain since 2021, amid reports that Adobe is nearing a $1.9 billion acquisition deal for the digital-marketing software firm.