Stock Market Update

[BRIEFING.COM] The stock market captured modest but broad-based gains today that propelled the S&P 500 (+0.2%) to a new record intraday (6,487.03) and closing high (6,481.40).

The Nasdaq Composite (+0.2%) and DJIA (+0.3%) also finished higher, while the Russell 2000 (+0.7%) and S&P Mid Cap 400 (+0.7%) outperformed, as steady September rate cut expectations provided an added tailwind for small-cap and mid-cap names.

Though the size of today's gains was not particularly eye-opening, the scope of their breadth reflected a market that trades cautiously optimistic ahead of NVIDIA's (NVDA 181.60, -0.17, -0.09%) earnings report and Friday's PCE report. 

Advancers outpaced decliners by a greater than 8-to-5 ratio on the NYSE and a roughly 4-to-3 clip on the NASDAQ.

Eight S&P 500 sectors advanced, with only the communication services (-0.1%) sector incurring a modest loss, while the health care and industrials sectors finished flat. 

The energy sector (+1.2%) posted the widest gain today, supported by crude oil futures settling today's session $0.89 higher (+1.4%) at $64.14 per barrel.

Steady improvement throughout the session in the information technology sector (+0.5%) contributed to the closing gains across the major averages. While NVIDIA's upcoming earnings dominated headline buzz today, the stock itself finished slightly lower, and the PHLX Semiconductor Index (+0.3%) performed in line with the broader market. 

Software stocks were the top movers within the sector, with strength following MongoDB's (MDB 295.70, +81.36, +37.96%) impressive beat-and-raise earnings report yesterday afternoon. Datadog (DDOG 131.75, +5.44, +4.31%), ServiceNow (NOW 888.24, +23.58, +2.73%), and Salesforce (CRM 250.06, +6.32, +2.59%) were among the packaged software names that posted nice gains today. 

Earnings also contributed to strength among retail names, with shares of Kohl's (KSS 16.16, +3.12, +23.93%) surging after an EPS beat. PVH (PVH 81.78, -0.71, -0.86%) and Abercrombie & Fitch (ANF 95.50, -1.24, -1.28%) finished lower despite posting earnings beats, and the SPDR S&P Retail ETF added 1.8% today. 

Headlines remained fairly subdued today, with attention still centered on President Trump's dismissal of Fed Governor Lisa Cook, a move that has already set the stage for a legal battle.

In a CNBC interview, New York Fed President John Williams (FOMC voter) described Ms. Cook as highly respected but declined to comment on the allegations against her. On monetary policy, Mr. Williams said that if inflation data evolves as he anticipates, gradual rate cuts would be appropriate, though policy must remain guided by incoming data.

He also noted that if PCE inflation is 2.9%, he attributes 40-50 basis points to tariff effects. Meanwhile, the probability of a 25-basis point cut at the September FOMC meeting held steady at 87.2%, according to the CME FedWatch tool.

Looking ahead, Friday's PCE report will provide a key update on inflation trends, but for now, market participants are squarely focused on NVIDIA's earnings, which are expected to be a defining catalyst for near-term market direction.

U.S. Treasuries ended Wednesday on a mostly higher note, while the long bond could not avoid a slightly lower finish. The 2-year note yield settled down six basis points to 3.62%, the 10-year note yield settled down two basis points to 4.24%, and the 30-year note yield settled unchanged for the day at 4.91%.

• Nasdaq Composite: +11.8% YTD
• S&P 500: +10.2% YTD
• DJIA: +7.1% YTD
• Russell 2000: +6.4%
• S&P Mid Cap 400: +4.6% YTD

Reviewing today's data:

• The weekly MBA Mortgage Index was down 0.5% after falling 1.4% a week ago. The Refinance Index was down 3.5% while the Purchase Index rose 2.2%.