US Stock Futures Edge Higher Ahead of Nvidia Earnings: Nasdaq, S&P 500, & Dow in Focus

US Stock Futures Steady Ahead of Key Earnings

Markets on edge ahead of Nvidia earnings and Fed clues. US stock futures edged higher in early trading on Wednesday, August 27. US economic indicators lifted expectations of a September Fed rate cut. However, the gains were modest as investors traded carefully ahead of highly anticipated corporate earnings and key US economic data.

The modest upswing in US stock futures aligned with a mixed morning session in the Asian markets.

The Dow Jones E-mini rose 33 points, while the Nasdaq 100 E-mini and S&P 500 E-mini gained 23 points and 5 points, respectively. 10-year US Treasury yields were flat on Wednesday, August 27, after retreating overnight. The overnight pullback supported demand for risk assets. Lower rates make future earnings more valuable, lifting US futures markets.

US Consumer Confidence Dips Amid Labor Market Jitters

The US CB Consumer Confidence Index dropped from 98.7 in July to 97.4 in August. The August survey showed that consumers’ views on current job availability fell for an eighth successive month. Additionally, consumers became more pessimistic about the outlook for job availability and less optimistic about their income prospects.

Weakening consumer sentiment toward the labor market coincided with Fed Chair Powell’s concerns about a cooling jobs market. According to the CME FedWatch Tool, the chances of a September Fed rate cut rose from 83.7% on August 25 to 87.2% on August 26, reflecting the effect of labor market data on the Fed rate path.

Bob Elliott, Chief Investment Officer at Unlimited Funds, commented on US labor market conditions, stating:

“Many headline job stats look ok, but triangulations like confidence surveys, job postings, and wage trackers all point to much softer conditions and little hope for an upswing in demand ahead.”

Why labor market data matters. A cooling labor market may slow wage growth and weigh on sentiment, potentially dampening consumer spending. A pullback in consumer spending may dampen inflationary pressures. Additionally, weaker spending may affect the US economy, given that private consumption accounts for over 60% of the US GDP.

Tuesday’s data came ahead of the crucial Personal Income and Outlays Report (August 29) and the US Jobs Report (September 5). These reports could dictate the Fed’s near-term rate path.

Corporate Earnings and Fed Speakers in Focus

Later today, corporate earnings will influence risk sentiment as Nvidia (NVDA) takes center stage. Second-quarter earnings will reflect the impact of the US ban on chip sales to China. NVDA previously projected the ban to lead to an $8 billion hit on net profits in the second quarter. The company’s outlook will be crucial given the US government’s 15% levy on chip sales to China.

While NVIDIA’s earnings release will be the main event, Chinese tech giant Alibaba (BABA) will also release its earnings report this week. Brian Tycangco, editor at Stansberry Research, commented:

“BABA is being bought up again by mainland investors ahead of the much anticipated 1QFY26 results.”

Beyond the earnings, FOMC members’ speeches will continue to draw market attention. Views on the Fed rate path through the fourth quarter would influence sentiment.

Key Asian Market Movers

Asian markets were mixed in morning trading as investors considered economic data from China, the Fed’s policy outlook, and Beijing’s stimulus moves. The Hang Seng Index fell 0.16% in morning trading, giving up early gains. Industrial profit numbers from China and market caution ahead of today’s US earnings pushed the Index into negative territory.

Meanwhile, Mainland China’s equity markets reversed Tuesday’s losses in morning trading on Wednesday. August 27. The CSI 300 and the Shanghai Composite Index climbed 0.72% and 0.33%, respectively. Recent stimulus announcements and government pledges to boost consumption and address unemployment continued to send stocks higher.

The Nikkei 225 advanced 0.32% as USD/JPY rose 0.36% to 147.844 in morning trading. A weaker Yen could boost overseas demand and corporate earnings, raising share prices. Gold gave up some of Tuesday’s gains, falling 0.32% to $3,382.

Looking beyond the Wednesday session, economic data from Japan and China would likely influence risk appetite.

Upbeat Japanese data (out on August 29) could boost bets on a Bank of Japan rate hike, potentially weighing on risk appetite. Chinese economic data (out on August 27 and 31) and Beijing’s stimulus measures will also influence market sentiment.

Technical Setups: The key levels traders are watching as Earnings collide with Fed Bets

Despite the cautious morning session, the broader short-term bias remains bullish, hinging on upcoming corporate earnings, key economic data, and FOMC members’ speeches.

Dow

• Resistance: August 22 high of 45,841, 46,000, then 46,500.
• Support: August 21 low of 44,642 and the 50-day EMA (44,309).

Nasdaq

• Resistance: August 18 high of 23,882, 24,000, then 24,500.
• Support: August 20 low of 23,035 and the 50-day EMA (23,004).

S&P 500

• Resistance: August 22 high of 6,496 and 6,750.
• Support: August 20 low of 6,363 and the 50-day EMA (6,303).

Will Nvidia send the Nasdaq Composite to new highs or send risk assets south? The next fortnight could prove pivotal. Follow our live coverage and consult our economic calendar.