It was another choppy session for stocks Wednesday as market participants looked ahead to Nvidia’s (NVDA) after-the-close earnings event. While the broader markets failed to make big moves, there was plenty of action among individual stocks.
NVDA shares finished the day down 0.1%, while the broader market managed to hold onto modest gains into the close. The Dow Jones Industrial Average finished up 0.3% to 45,565, the S&P 500 rose 0.2% to 6,481, and the Nasdaq Composite was 0.2% higher at 21,590.
“As the world’s most valuable company [$4.4 trillion in market cap], Nvidia makes up 8% of the S&P 500 by weighting,” says Stephen Callahan, trading behavior specialist at Firstrade. “This means whichever way Nvidia trades, up or down, it’s going to pull the rest of the market with it.”
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Callahan adds that Nvidia’s bellwether status among artificial intelligence (AI) companies means that its results and the stock’s underlying move will have a big effect.
As for its actual results, William Blair analyst Sebastien Naji expects “another beat-and-raise quarter powered by volume deployments of Blackwell GPUs and NVL72 racks.”
While the analyst says the second quarter is unlikely to have any revenue contributions from China, he expects to see H20 revenue included in forward guidance.
You can track all the latest news and updates from Nvidia’s earnings event on our live blog.
Kohl’s soars after earnings
Elsewhere on the earnings calendar, embattled retailer Kohl’s (KSS) reported fiscal second-quarter earnings of 56 cents per share on revenue of $3.35 billion – beating analysts’ estimates. Same-store sales fell 4.2%, less than expected.
In the company’s earnings call, interim CEO Michael Bender said that the Q2 results are encouraging, but management also recognizes “that consumers continue to be pressured and are being choiceful with their purchases.”
Specifically, he noted that “lower to middle income customers remain the most challenged, while our higher income customers have proven to be more resilient.”
The retail stock surged 24% in reaction to earnings, but remains 19% lower year over year. And Wall Street isn’t fooled. Of the 15 analysts covering KSS who are tracked by S&P Global Market Intelligence, just one says it’s a Buy, while eight have it at Hold and six rate it a Sell or Strong Sell.
UBS Global Research analyst Jay Sole is among those with a Sell rating on the consumer discretionary stock, along with a $4 price target – 74% below current levels.
While “Kohl’s partnership with Sephora will generate roughly $2 billion in sales,” the analyst wrote in an August 18 note, it “will not offset the secular forces working against the company’s sales growth, such as consumers’ migration to other channels.”
Sole adds that “cost inflation, weaker share losses, a more promotional environment and tariff impacts will pressure operating margins.”
MongoDB jumps on strong customer growth
MongoDB (MDB) was another notable post-earnings mover, jumping 38% after the document database firm’s beat-and-raise quarter.
Additionally, the company said it added more than 5,000 customers in the first half of its fiscal year – “the highest ever” for that six-month time frame, according to MongoDB CEO Dev Ittycheria.
BofA Securities analyst Brad Sills says that there was a confluence of factors that drove upside for MDB, including the company’s focus on large accounts with higher quality workloads and clear communication in the mid-market that resulted in a better win rate.
“With a number of key growth initiatives working, and best of breed position in a large addressable market for unstructured database ($100 billion), we see a healthy runway for growth,” the analyst adds.
Sills has a Buy rating on the tech stock and raised his price target to $345 from $275, representing implied upside of 18% to current levels.
In Fed news
Turmoil between President Donald Trump and the Federal Reserve remained an overhang on Wall Street Wednesday.
Trump on Monday evening posted on his Truth Social account that he had fired Fed Governor Lisa Cook amid accusations of alleged mortgage fraud, though Cook said she will not leave her position and will take legal action.
The Supreme Court has said that the president needs “cause” to fire a Federal Reserve official, which Trump claims he has, though allegations against Cook remain unproven at this point. Meanwhile, the Fed said in a statement on Tuesday that it will abide by any court decision.
“Long tenures and removal protections for governors serve as a vital safeguard, ensuring that monetary policy decisions are based on data, economic analysis, and the long-term interests of the American people,” the Fed spokesperson said.
