Here is Schwab's early look at the markets for Monday, August 24:
Stocks rallied Friday, but markets still head into the new week on shaky ground with elevated Treasury yields and oil prices pressuring major indexes. A light earnings and economic calendar today could keep investors focused on that backdrop. Attention will then turn to July inflation data, another round of major tech earnings, and the Federal Reserve's Jackson Hole Symposium.
The week's economic highlight will likely be the Fed's favored inflation gauge—the personal consumption expenditures, or PCE, price index—which is due Wednesday at 8:30 a.m. ET. Analysts expect year-over-year headline PCE inflation to fall slightly to 3.6%. Core PCE—which excludes more volatile energy and food prices—is seen holding steady at 3.3%, according to Oxford Economics.
Nvidia earnings will then take center stage after the bell on Wednesday. The bellwether's quarterly results will be critical, with tech stocks struggling last week and investor enthusiasm in the AI trade showing signs of fading. Nvidia is expected to report earnings per share of $2.09 on quarterly revenues of $92 billion. Those figures would both represent year-over-year growth of nearly 100%. Expectations are certainly high, and in recent quarters, even when Nvidia has topped consensus forecasts and raised its guidance, the stock has struggled.
The Fed's Jackson Hole Economic Policy Symposium on Thursday and Friday may also command more attention than usual after Treasury yields rose across the curve last week, leading the 30-year yield to a multi-decade high of 5.27%. Investors will be looking for insights from Fed officials on how monetary policy will interact with the Treasury’s government-debt buybacks. Chairman Kevin Warsh's speech—slated for Friday at 10:00 a.m. ET—could be particularly important given recent inflation pressures and his decision to scale back forward guidance.
On Friday, futures trading priced in a roughly 38% chance of a rate hike at the Fed's mid-September meeting, according to the CME FedWatch Tool. If those odds rise after next week's inflation data and Fed commentary, it could lift yields even higher, putting more pressure on markets.
However, it's worth noting that the recent rise in yields has been driven by a broad mix of factors. "The move appears less about higher inflation expectations, which have been relatively stable, and more about a rising term premium driven by fiscal uncertainty, heavy Treasury supply, global pressure on long-end yields, and shifting expectations for Federal Reserve rate changes," said Cooper Howard, director of fixed income research and strategy at the Schwab Center for Financial Research.
Howard noted that the Treasury Department's recent decision to expand buybacks of longer-dated government debt could help improve liquidity and support demand at the margin, but the program remains small relative to the overall size of the Treasury market.
Turning back to the earnings and economic calendar, the Chinese e-commerce giant PDD Holdings is the only major firm set to report today. That will likely leave investors looking ahead to earnings from Nvidia, CrowdStrike, Salesforce, and Synopsys—which are all due Wednesday after the bell. Multiple leading Canadian banks and names like Intuit and Marvell Technology are also on the calendar next week.
No major economic reports are scheduled today. However, June's S&P Cotality Case-Shiller Home Price Index, July's new homes sales data, and August's consumer confidence reading will be in-focus tomorrow.
Investors will then get a look at the second estimate of second-quarter gross domestic product, or GDP, on Wednesday. The first estimate in late July showed GDP expanding at an annualized rate of just 1.5%, down from 2.1% in the first quarter. Consumer spending remained strong in that report, however, so it may draw attention once again.
Looking at Friday's market movers, Tesla jumped 5.1% after the company confirmed on social media that it will bring its electric Semi truck to Europe. Nevada's Transportation Authority also approved a commercial robotaxi permit for the electric vehicle maker on Thursday.
Ross Stores popped 4.4% after topping consensus earnings estimates and raising its full-year guidance in its second quarter report. The discount retailer's revenue jumped 13% year-over-year, while comparable store sales rose 10% from a year ago.
The bitcoin Treasury company Strategy and the cryptocurrency exchange Coinbase also extended their winning streaks amid bitcoin's rally. The leading cryptocurrency recorded its biggest weakly gain in nearly two years last week. Catalysts included a sliding U.S. dollar, short covering, and President Trump's push for the passage of the Clarity Act. Wednesday and Thursday also saw the biggest two-day net inflows into spot bitcoin ETFs since mid-January, according to data from Glassnode.
Overall, eight out of 11 S&P 500 sectors ended Friday in the green. Materials and healthcare led the pack, while utilities lagged as investors took a risk-on approach at the end of a volatile trading week.
Market breadth also improved slightly. Roughly 69% of S&P 500 stocks traded above their 200-day moving average, while 57.6% traded above their 50-day moving average.
The Dow Jones Industrial Average® ($DJI) rose 517.80 points (+0.98%) Friday to 53,277.01; the S&P 500 Index ($SPX) gained 33.21 points (+0.43%) to 7,674.37, and the Nasdaq Composite® ($COMP) jumped 113.29 points (+0.44%) to 26,180.46.
For the week, the Dow Jones Industrial Average sank 0.85%, the S&P 500 dropped 1.43%, and the Nasdaq Composite fell 2.05%.
