The S&P 500 and Dow have been hovering around all-time highs since last week amid expectations among investors that the Federal Reserve will soon cut interest rates.

Wall Street has also had its eye on company earnings reports for clues about the state of the economy, the health of consumers and to gauge whether stock valuations for big tech growth companies like Nvidia have become overblown relative to companies’ prospects for future growth.

“That’s the major question, and I think all eyes will be on Nvidia as they report this week,” said Bill Merz, head of capital markets research at US Bank Wealth Management. “That’s kind of the elephant in the room, so to speak, that many investors will focus on.”

The semiconductor company, with a total market value topping $US3 trillion ($4.4 trillion), reports its latest results on Wednesday. It rose 1.5 per cent on Tuesday. Wall Street’s mania around artificial intelligence has helped propel a 159 per cent gain for the stock this year.

The market got some positive economic data to mull over Tuesday.

The Conference Board, a business research group, said that its consumer confidence index rose to 103.3 in August from 101.9 in July. The results were better than economists expected and could help bolster sentiment that consumers remain resilient, despite pressure from inflation.

Consumer spending accounts for nearly 70 per cent of US economic activity. That has been a strong area of the economy, along with the jobs market.

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Best Buy and Dollar General will report their latest results Thursday. That could give investors more insight into where, and how much, consumers are spending.

Most of the companies in the S&P 500 have reported better-than-expected profit so far this reporting season. Several companies rose Tuesday as traders cheered their latest quarterly snapshots.

Hain Celestial Group jumped 18.6 per cent after the company’s fiscal fourth-quarter profit topped Wall Street’s estimates. Trip.com Group climbed 8.6 per cent after its second-quarter earnings beat analysts’ forecasts and the company touted strong travel demand.

The parent company of the Paramount movie studio slid 7.1 per cent after Edgar Bronfman Jr., the former head of Warner Music Group, abandoned his bid for the company, clearing the way for it to be acquired by the media company Skydance.

Investors are looking ahead to Friday, when the government releases its latest data on inflation with the PCE, or personal consumption and expenditures report, for July. It’s the preferred measure of inflation for the Federal Reserve, which has signalled that long-awaited interest rate cuts are coming.

with AP

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