Stock Market Today: Stocks Retreat Ahead of Nvidia Earnings
Stocks fell to start the holiday-shortened week as Nvidia sold off ahead of earnings.
The U.S. stock market was closed Monday for the Presidents' Day holiday, and investors returned Tuesday with a risk-off mindset. Indeed, the three main indexes closed today with losses ahead of what will be a busy few days on Wall Street.
Most notably is tomorrow night's earnings event from artificial intelligence (AI) chipmaker Nvidia (NVDA). The mega-cap stock has been a market leader over the past 18 months, surging more than fivefold in that time frame amid optimism over sizzling demand for its generative AI chips.
"There aren't enough superlatives to describe the run the stock has been on since its 2022 lows," says Jay Woods, chief global strategist at Freedom Capital Markets.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Today, though, NVDA slumped 4.4% – losing $78 billion in market value along the way. To put this figure in perspective, that's roughly equivalent to the total market cap of carmaker Stellantis (STLA, -1.1%). The pullback likely comes as investors take profits off the table ahead of the chipmaker's turn in the earnings spotlight.
But investors shouldn't worry about the mega cap's longer-term momentum. According to S&P Global Market Intelligence, analysts expect the company to generate average annual earnings growth of almost 44% over the next 3 to 5 years.
Home Depot reports Q4 beat, boosts dividend
However, Nvidia isn't the only notable name on this week's earnings calendar. Ahead of today's open, results from blue chip stocks Home Depot (HD, +0.06%) and Walmart (WMT, +3.2%) gave investors another check on how retailers and the consumer are faring as interest rates remain high and inflation stays sticky.
Home Depot beat on both the top and bottom lines for its fourth quarter, although its guidance for full-year sales growth of 1% came in below analysts' estimates. The company also hiked its quarterly dividend by 7.7%.
"While it's promising that Home Depot beat earnings, these results are a disappointing end to Q4 and suggest that 2024 may be off to a slower start for the home improvement industry," says Jon Bostock, a home improvement industry expert and CEO at Leaf Home. Still, Bostock is optimistic that the spring and summer real estate market will be strong, and we'll see a rise in sales and spending.
"As boomers start to offload their homes, we'll see an increase in home improvement spending as millennials who are buying boomers' homes make necessary updates," he adds.
Walmart reports strong Q4 results, Vizio acquisition
Walmart, meanwhile, reported higher-than-expected fourth-quarter earnings and revenue. The company also said e-commerce revenue surged 23% over the three-month period, with total sales for the full year topping $23 billion.
Additionally, Walmart said it will buy smart TV maker Vizio for $2.3 billion. In the retailer's earnings call, CEO Doug McMillon said the acquisition will give WMT "the opportunity to reach and serve customers in new ways and connect more dots for those that advertise with us." The Dow Jones stock will undergo a 3-for-1 stock split after Friday's close.
Discover jumps on Capital One buyout buzz
In non-earnings news, Discover Financial Services (DFS) spiked 12.6% after Capital One Financial (COF, +0.1%) said it will buy the credit card company in an all-stock deal valued at $35 billion. The acquisition of DFS will help COF "build a payments network that can compete with the largest payments networks and payments companies," said Capital One CEO Richard Fairbank in a press release.
Still, the merger's not a done deal. Investors should prepare for a longer regulatory discussion, says Kevin Kennedy, analyst at global research firm Third Bridge. "On one hand, it benefits the proponents of the Credit Card Competition Act in providing an alternative routing option to Visa (V, -1.2%) and Mastercard (MA, -3.5%)," Kennedy says. "On the other hand, it significantly consolidates the credit card lending industry in a way that could reverberate antitrust rhetoric from the Federal Trade Commission."
As for the main indexes, the Nasdaq Composite slumped 0.9% to 15,630, the S&P 500 shed 0.6% to 4,975, and the Dow Jones Industrial Average finished 0.2% lower at 38,563.
Related content
- Peacock And Paramount Plus Might Be The Next To Merge
- Kiplinger's Commodities Forecast
- Disney Plus Password Sharing Crackdown Hits U.S. Market
-
How to Plan a Microvacation That Actually Feels RestfulHow a simple long weekend can boost your mood, reduce stress and make winter feel shorter.
-
We're retired and fight more than ever. Should we take a break?Can taking a break save a marriage? We asked professional relationship therapists for advice.
-
Turning 59½: 5 Planning Moves Most Pre-Retirees OverlookAge 59½ isn't just when you can access your retirement savings tax-free. It also signals the start of retirement planning opportunities you shouldn't miss.
-
Turning 59½: 5 Planning Moves Most Pre-Retirees Overlook
Age 59½ isn't just when you can access your retirement savings tax-free. It also signals the start of retirement planning opportunities you shouldn't miss.
-
Are Your Retirement Numbers Not Looking Good? A Financial Adviser Runs Through Your OptionsIf you're worried about a shortfall between your income and expenses in retirement, you're not alone. But there are ways you can make up the difference.
-
How to Make the Most of These 2 Tax Breaks ASAP (They Have Expiration Dates)Taxpayers can strategically use these temporary tax opportunities in particular to lock in long-term tax savings. Here's how.
-
What Changed on January 1: Check Out These Opportunities Created by the New Tax LawA deep dive into the One Big Beautiful Bill Act (OBBBA) reveals key opportunities in 2026 and beyond.
-
Beat the Money Blues With This Easy Financial Check-In to Get 2026 Off to a Good StartAs 2026 takes off, half of Americans are worried about the cost of everyday goods. A simple budget can help you beat the money blues and reach long-term goals.
-
Do Self-Storage REITs Deserve Space in Your Portfolio? It's a Yes From This Investment AdviserSelf-storage is an overlooked area of the real estate market, even though demand is strong. Investors can get in on the action through a REIT.
-
Dow Hits a Record High After December Jobs Report: Stock Market TodayThe S&P 500 also closed the week at its highest level on record, thanks to strong gains for Intel and Vistra.
-
The December Jobs Report Is Out. Here's What It Means for the Next Fed MeetingThe December jobs report signaled a sluggish labor market, but it's not weak enough for the Fed to cut rates later this month.
