S&P 500 Tops 6,500 Even as Nvidia Slips: Stock Market Today

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Volume thinned out Thursday ahead of the long holiday weekend. As a reminder, Monday is a stock market holiday, with both the equities and bond markets closed for Labor Day.

Stocks, however, gained ground even as AI bellwether Nvidia (NVDA) – the world's biggest company by market cap – slipped following its quarterly results.

After Wednesday's close, Nvidia reported fiscal second-quarter earnings of $1.05 per share on revenue of $46.7 billion, beating Wall Street's estimates for earnings of $1.01 per share on $46.1 billion in sales.

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The chipmaker said revenue in its data center segment, which makes its in-demand artificial intelligence chips, rose 56% to $41.1 billion, falling just shy of the $41.34 billion analysts had called for.

The company also forecast fiscal third-quarter revenue of $54 billion, roughly in line with consensus estimates.

NVDA stock closed down 0.8% today, "a move that reflected guidance that beat rather than demolished pre-reporting consensus estimates for fiscal Q3," says Argus Research analyst Jim Kelleher.

Still, the analyst says that investors should either establish or add to positions "in this preeminent vehicle for participation in the AI economy," given his belief that the shares have much more room to run.

Kelleher reiterated his Buy rating on Nvidia after earnings and lifted his price target to $220, representing implied upside of nearly 22% to current levels.

Snowflake soars 20% after earnings

Elsewhere in the tech space, Snowflake (SNOW) surged 20.3% after the AI cloud platform provider's beat-and-raise quarter, driven by strong product revenue.

Wall Street was quick to chime after the results. Wedbush analyst Daniel Ives, for one, maintained his Outperform (Buy) rating on the stock and hiked his price target to $250 from $230.

"Its core business remains strong while AI remains a driver for customers choosing SNOW, which influenced nearly 3% of new customer adds in the quarter," Ives wrote in a note to clients. "The company is well-positioned to benefit from the significant acceleration of [the] AI use case."

Pure Storage soars after beat-and-raise quarter

Pure Storage (PSTG) was another notable post-earnings mover, gaining 32.3% after the data storage provider reported a top- and bottom-line beat for its fiscal second quarter.

The company also increased its full-year guidance, now expecting revenue to grow 14% at the midpoint and operating income to rise 10%.

PSTG's results "instill greater investor confidence in the company's ability to sustain durable enterprise share gains, monetize hyperscaler engagements, and capitalize on rising AI-driven demand," says William Blair analyst Jason Ader.

The analyst reiterated his Outperform rating on PSTG after earnings, saying he expects "shares to re-rate higher as investors better appreciate the implications of the Meta Platforms (META) design win – namely, that Pure will be a major player in cloud storage and that it is fundamentally a software company."

As for the major indexes, the Nasdaq Composite gained 0.5% to 21,705. The Dow Jones Industrial Average rose 0.2% to 45,636 and the S&P 500 added 0.3% to 6,501 – new record closing highs.

U.S. economy grew at a solid clip in Q2

It wasn't all about tech stocks on Thursday. Data from the Bureau of Economic Analysis shows that gross domestic product (GDP) rose at an annual rate of 3.3% in the second quarter, higher than the initial reading of 3%.

Meanwhile, data from the Labor Department showed that initial jobless claims fell by 5,000 last week to 229,000.

Next up is the July Personal Consumption Expenditures (PCE) Price Index – the Fed's preferred measure of inflation – that is set to be released ahead of Friday's open.

While Clark Bellin, president and chief investment officer at Bellwether Wealth, says that tomorrow's PCE data "will be scrutinized," it's unlikely to change expectations for a rate cut in September.

"Powell successfully prepared markets for this September rate cut outcome during his Jackson Hole speech and it's unlikely that any economic data over the next few weeks will change the Fed's course for September."

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With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at a local investment research firm. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.