Dow on Track for All-Time High as Nvidia Earnings Loom Over AI Rally

The Dow Jones Industrial Average is on track to hit a new all-time high as investors brace for Nvidia’s upcoming earnings report, which could either reinforce or challenge the current AI-driven market rally [12]. The optimism surrounding U.S. equities was fueled by a sharp rebound on Friday, following remarks from Federal Reserve Chair Jerome Powell that hinted at potential rate cuts as early as next month. Stock futures continued to show modest gains on Sunday evening, with the Dow Jones Industrial Average futures up 0.05% and Nasdaq futures adding 0.06% [1]. The S&P 500 futures also rose 0.05%, reflecting broad-based market optimism despite lingering concerns about the sustainability of the AI boom [1].

The market’s enthusiasm for AI has been a key driver of recent gains, with Nvidia at the center of the narrative. However, growing skepticism has emerged. A recent MIT study reported that 95% of AI pilot programs at businesses have failed to deliver substantial returns [1]. Meanwhile, OpenAI CEO Sam Altman has drawn comparisons between the current AI frenzy and the dot-com bubble of the 1990s, adding to investor caution [1]. These concerns are likely to be tested when Nvidia reports its quarterly earnings after the close of trading on Wednesday.

Analysts forecast that Nvidia will report adjusted earnings per share of $1 and revenue of $45.88 billion [6]. The tech giant has become a bellwether for the AI sector, with its fortunes closely tied to the broader momentum in AI-related investments. U.S. hyperscalers such as Alphabet, Microsoft, Amazon, and Meta are projected to invest nearly $400 billion in AI infrastructure this year, underscoring the scale of current demand [1]. However, the recent agreement between Nvidia and AMD to share 15% of their chip sales to China with the U.S. government has introduced additional uncertainty about future profitability and regulatory risks [1].

Investor sentiment is also being influenced by evolving inflation data. The U.S. personal consumption expenditures (PCE) index is expected to show a 0.2% monthly increase and a 2.6% annual rise in July, unchanged from June [1]. The core PCE, which excludes food and energy, is projected to rise 0.3% monthly and 2.9% annually, slightly faster than the 2.8% annual rate recorded in June. These figures suggest that inflationary pressures remain elevated but are stabilizing. Some Fed officials, including Powell, have argued that the inflationary impact of recent tariffs is likely temporary, with the labor market showing early signs of easing [1].

The 10-year Treasury yield, which had fallen sharply on Friday to 4.256%, remained stable, signaling that market expectations for rate cuts are still intact [1]. Meanwhile, the U.S. dollar showed minimal movement against major currencies, and gold prices dipped slightly to $3,413.80 per ounce. Crude oil prices edged higher, with U.S. oil up 0.2% to $63.79 per barrel and Brent crude up 0.15% to $67.83 [1].

As the market approaches a pivotal week, the outcome of Nvidia’s earnings report is likely to have wide-reaching implications. A strong performance could reinforce the AI investment thesis and push the Dow further into record territory. Conversely, a disappointing report or weaker-than-expected guidance could trigger a reevaluation of current valuations and amplify concerns about a potential bubble. Investors are accordingly positioning across a range of outcomes, with the AI sector poised to face one of its most important tests yet.

Source:

[1]title1.............................(https://fortune.com/2025/08/24/stock-market-today-dow-record-high-nvidia-earnings-ai-bubble-pce-inflation-fed-rate-cuts/)

[6]title6.............................(https://stocktwits.com/news-articles/markets/equity/august-22-stock-watch-wipro-apollo-hospitals-hul-hikal-vedanta-gmr-airports-are-on-watchlist/chsmoF0Rdiz)

[12]title12............................(https://www.quorumreport.com/newsclips/newsclips.cfm)