Dow Jones and S&P500: Caterpillar, Home Depot Lift Blue Chips as Retail Earnings Continue

Stock Futures Slip as Traders Brace for Powell and Retail Earnings

Stock index futures edged lower Tuesday morning, pressured by underwhelming results from Home Depot and investor caution ahead of Federal Reserve Chair Jerome Powell’s upcoming speech. Dow futures hovered just below the flatline, while S&P 500 and Nasdaq 100 futures dipped around 0.1% each.

The week’s main focus remains on Powell’s remarks from Jackson Hole on Friday, with traders expecting further clues about potential rate cuts. Retail earnings are also in the spotlight, with key reports from Walmart, Target, and Lowe’s still to come. The cautious tone in early trading reflects concern over consumer resilience and how tightening trade policies could influence spending into the fall.

What Did Home Depot’s Miss Say About the Consumer?

Home Depot shares dropped nearly 2% premarket after reporting weaker-than-expected Q2 earnings, but are now expected to open about 1.09% higher at $394.70.

The company posted adjusted earnings of $4.68 per share on revenue of $45.28 billion, falling short of analysts’ $4.71 EPS and $45.36 billion revenue estimates. Despite the miss, it reaffirmed full-year guidance.

Investors are parsing these numbers to gauge consumer strength, especially in discretionary areas. Upcoming earnings from Walmart and Target will further clarify the retail arena, as traders assess how rising import tariffs and a softening labor market are weighing on spending.

Is the Fed About to Cut Rates Again?

Markets are pricing in an 83% chance of a 25-basis-point rate cut in September, according to the CME FedWatch tool. Powell’s speech on Friday could cement that expectation. Analysts believe this will be his final Jackson Hole appearance as Fed Chair, which may prompt a message reinforcing central bank independence and easing bias.

Traders are betting that slowing inflation, signs of a cooling job market, and financial conditions that remain tight will drive the Fed toward easing. The 10-year Treasury yield rose slightly to 4.347%, while the two-year yield ticked up to 3.777%, showing cautious movement ahead of the speech.

Intel, Caterpillar and Palo Alto Networks Move on Stock-Specific News

Intel shares surged over 5% in extended trading after SoftBank committed to a $2 billion investment at $23 per share. The move marks a notable vote of confidence following a year of underperformance versus the broader semiconductor sector.

Caterpillar also drew attention after Evercore ISI upgraded it to “outperform” with a new price target of $476—over 15% upside from Monday’s close. Analysts cited Caterpillar’s strong U.S. demand and operational leverage.

Palo Alto Networks popped 5% after beating Q2 estimates and delivering bullish guidance, just weeks after announcing a $25 billion acquisition of CyberArk.

What’s the Market Outlook from Here?

The market remains near all-time highs, but upward momentum hinges on confirmation of Fed policy direction and retail earnings. Powell’s Jackson Hole address will likely be the most impactful event this week. Traders are preparing for a more dovish tone, especially with signs of weaker growth and a softer labor market.

Watch for Target and Walmart results to offer further clarity on consumer demand, and monitor Treasury yields for confirmation of rate-cut bets. Short interest trends in big tech like Meta also suggest mounting skepticism as valuations stretch.

More Information in our Economic Calendar.