Stocks opened higher Wednesday but lost steam as the session wore on. All eyes today were on Nvidia (NVDA), with the chipmaker releasing its fiscal first-quarter results after the close. You can follow all the coverage in our Nvidia earnings live blog.
Wall Street was also tuned into the release of the minutes from the Federal Reserve's May meeting, hoping for clues as to when the central bank could resume its rate-cutting campaign.
Indeed, after lowering the federal funds rate by a full percentage point at the end of 2024, the central bank has held it steady in its last few meetings.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.
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.
Fed Chair Jerome Powell has said multiple times that the central bank is waiting for more clarity on President Donald Trump's tariff policy and that the U.S. economy is strong enough to allow for a wait-and-see approach to monetary policy.
This outlook was echoed in Wednesday afternoon's release of the Fed meeting minutes.
"Participants agreed that uncertainty about the economic outlook had increased further, making it appropriate to take a cautious approach until the net economic effects of the array of changes to government policies become clearer," the minutes stated.
And while Fed officials agreed that labor market conditions and the economy were in "solid" shape, inflation remains "somewhat elevated."
But the administration's tariffs, which were "significantly larger and broader" than the central bankers anticipated, created "unusually elevated" uncertainty to their economic outlooks.
The Fed minutes helped buoy the 2-year and 10-year Treasury yields, which ended the day at 3.992% and 4.473%, respectively.
As for the main indexes, the Dow Jones Industrial Average dropped 0.6% to 42,098, the S&P 500 fell 0.6% to 5,888, and the Nasdaq Composite gave back 0.5% to 19,100.
Abercrombie & Fitch pops after earnings
Abercrombie & Fitch (ANF) was one of the best stocks on Wednesday, surging 14.7% after the apparel retailer reported higher-than-expected fiscal first-quarter earnings of $1.59 per share on revenue of $1.1 billion.
The company also raised the top end of its full-year revenue forecast, now expecting growth of 3% to 6% – more than analysts are anticipating.
However, Abercrombie lowered its profit and operating margin outlooks due to the estimated impact of Trump's tariffs, which are expected to create a $50 million "cost impact."
Broadcom can rally another 20%, says one analyst
Broadcom (AVGO) added 1.6% on Wednesday after Melius Research analyst Ben Reitzes lifted his price target on what he calls a "must-own" chip stock to $283 from $198.
The new target price represents implied upside of nearly 20% to current levels and would be an impressive feat for a stock that's already gained more than 60% since its early April lows.
Broadcom currently has seven customers for its custom artificial intelligence (AI) chips, Reitzes says, which could translate into a serviceable addressable market of up to $210 billion by the end of this decade.
The analyst adds that the company's AI networking chips create a substantial opportunity and could see long-term annual revenue growth of 20%.
Reitzes also highlights Broadcom's $10 billion stock buyback program, which could boost shareholder returns.
AVGO is also one of Kiplinger's favorite dividend-paying stocks, having increased its payout for the past 11 years.
Broadcom will take its spot on the earnings calendar after the close next Thursday, June 5.
Related content
- Kiplinger's Economic Calendar for This Week (May 26-30)
- Can Stocks Picked by AI Beat the Market? 3 Stocks to Watch
- Hot Upcoming IPOs to Watch
-
Investors Buy the Nasdaq's Big Dip: Stock Market TodayStocks are up and down again to end an up-and-down week ahead of big earnings announcements and the eventual return of regular economic data flow.
-
What to Know About Portable MortgagesA closer look at how portable mortgages would work, who might benefit and why the concept is gaining attention amid high rates and limited supply.
-
Investors Buy the Nasdaq's Big Dip: Stock Market Today
Stocks are up and down again to end an up-and-down week ahead of big earnings announcements and the eventual return of regular economic data flow.
-
Here's How to Plan This Year's Roth Conversion, From a Wealth ManagerWhile time is running out to make Roth conversions before the end of the taxable year, consider taking your time and developing a long-term strategy.
-
Four Times You Need a Second Opinion on Your Financial PlanIs your financial plan fit for purpose — or is your adviser peddling an outdated strategy? When you see these red flags, it's time for a second opinion.Evan
-
'But It's Not My Fault!': Your Insurance Company Absolutely Will Blame You in These Five ScenariosInsurance companies care about 'fault' in more ways than you think — from payment mishaps to your neighbor's landscaping — so it's on you to manage the risks.
-
Dow Dives 797 Points as Government Opens: Stock Market TodayThe process of pricing and re-pricing realities old and new never stops, and next week promises to be at least as exciting as this week.
-
5 Core Stocks Every Investor Should Own In 2026 and BeyondCore stocks are solid, long-term investments that provide stable returns and steady growth within your portfolio. Here are five we like.
-
How to Calm Your Retirement Nerves When It's Time to Shift from Savings Mode to Spending ModeTransitioning from saving to spending in retirement can be tricky, but devising a strategic plan can help ensure a smooth and worry-free retirement.
-
Why Wills and Trusts Aren't Enough in the Great Wealth Transfer, From an Attorney Who KnowsFamilies need to prepare heirs through communication and financial know-how, or all that money could end up causing confusion, conflict and costly mistakes.
