Market Indexes Hold Flat as Wall Street Waits on Nvidia

Wednesday’s inflation reading came in slightly above expectations, and Wall Street shrugged. American stock markets are calm today as investors prepare for Nvidia (NVDA -1.38%) reporting Q2 2027 results after this evening’s closing bell.

The S&P 500 (^GSPC -0.05%) is essentially unchanged, up 0.02% as of 11:59 a.m. ET. The Nasdaq Composite (^IXIC -0.20%) is down 0.12% and the Dow Jones Industrial Average (^DJI -0.19%) has slipped 0.21%, putting a three-session winning streak at risk.

^SPX data by YCharts

The morning’s inflation data was the kind that would normally get a reaction, but today’s response was a collective yawn. The Fed’s preferred gauge, the PCE price index, rose 0.2% in July and 3.7% over the past year, both a hair above what economists wanted. The core reading, stripped of food and energy, held at 3.3%, exactly as expected. Inflation remains well above the Fed’s 2% target, and markets are pricing only about a one-in-three chance of a rate move at the Sept. 15-16 meeting.

The day’s oddest headline belonged to Meta Platforms (META +1.48%). The Facebook and Instagram parent rose about 1% on the same day it settled a social media addiction case for $16.7 billion. A settlement that size lifting a stock tells you investors were bracing for something worse.

On the Dow, Goldman Sachs (GS -1.63%) was the heaviest drag, down about 1% on its large weighting. You know, as usual. Ordinary market noise becomes bellwether material when a single stock holds an 11.7% weighting on the Dow index.

Elsewhere, oil slipped again as Iran and Oman reportedly inched toward a deal over the Strait of Hormuz. The gold-and-Bitcoin rally took a breather, with the iShares Bitcoin Trust (IBIT -0.58%) down 1.2% and the SPDR Gold Trust (GLD -1.51%) dropping 1.6%.

Image source: The Motley Fool.

Everything hinges on one report tonight

And that brings me to the one thing everyone is waiting for. Nvidia reports financial results shortly after 4 p.m. ET.

Revenue should rise roughly 97% year over year to $91.9 billion, while earnings should double from $1.04 to $2.08 per share. But the headline figures might not be the thing to watch this evening. I’m keeping a close eye on gross margins, where the distance from 75% tells you how Nvidia is feeling about the competitive landscape and memory pricing.

Margins slipping toward the low 70s would suggest Nvidia is absorbing higher memory costs to defend its lead, while margins holding well above that level indicate it still has the pricing power to protect profits.

Wednesday looks frozen because there will be a lot to talk about at the end of the week. After Nvidia’s health-check on the AI market, Fed Chairman Kevin Warsh will speak at the Jackson Hole conference on Friday. Wall Street won’t stay quiet much longer.