Semiconductor Rebound Lifts Stocks as NVIDIA Earnings and PCE Inflation Data Loom

Stocks finished modestly higher on Tuesday as renewed buying interest in semiconductor shares helped offset a mixed performance across the broader market. The Nasdaq Composite gained 0.7% to lead the major averages, while the S&P 500 and Dow Jones Industrial Average each advanced 0.3% during an otherwise relatively subdued session.

Chip stocks provided the clearest source of leadership after enduring considerable selling pressure over the past several sessions. The PHLX Semiconductor Index gained 1.4%, helping propel the information technology sector (+1.0%) to the top of the S&P 500 sector standings.

NVIDIA (NVDA 212.95, +4.47, +2.14%) snapped a seven-session losing streak ahead of its highly anticipated earnings report Wednesday after the close. Super Micro Computer (SMCI 38.45, +3.28, +9.33%) was an even bigger standout, ranking among the S&P 500’s best-performing components after Cisco (CSCO 111.11, +0.88, +0.80%) expanded its NVIDIA AI partnership to include Supermicro rack-scale systems in its Secure AI Factory.

Strength among large semiconductor companies also helped lift the Vanguard Mega Cap Growth ETF 0.6%, although performance among mega-cap stocks outside the chip trade was less consistent.

SpaceX (SPCX 137.97, +2.97, +2.20%) was a notable outperformer after confirming that construction of its Starbase launch facility in Louisiana will begin in 2027. Meta Platforms (META 570.05, +11.03, +1.97%) also posted a solid gain, providing support to the communication services sector (+0.5%).

Health care (+0.3%) edged higher as Moderna (MRNA 158.83, +19.94, +14.36%) once again attracted significant buying interest. The stock continued its volatile stretch following last week’s triple-digit surge on positive melanoma vaccine results, rebounding sharply Tuesday after recent profit-taking.

The positive finish for the major averages contrasted with weakness across several groups that had performed better in recent sessions. Retail stocks generally struggled, contributing to a 0.9% decline in consumer staples and a 0.3% loss in consumer discretionary.

Athletic apparel stocks were a particularly weak pocket following Dick’s Sporting Goods’ (DKS 124.31, -55.02, -30.68%) earnings report, which included disappointing results from Foot Locker. NIKE (NKE 39.48, -1.28, -3.13%) finished as the weakest Dow component, while Deckers Outdoor (DECK 88.74, -3.34, -3.63%) and lululemon athletica (LULU 118.33, -4.45, -3.62%) were also notable S&P 500 laggards as concerns spread across the athletic apparel group.

Oil prices provided another important crosscurrent. WTI crude futures settled $2.69 lower, or 3.2%, at $82.29 per barrel amid a relatively quiet day for geopolitical headlines. The decline pushed the energy sector (-1.7%) to the bottom of the sector standings but provided a more favorable backdrop for transportation, consumer, and other oil-sensitive areas.

Treasury yields also declined across the curve, removing some of the rate pressure that has periodically weighed on growth stocks and other rate-sensitive areas in recent weeks.

Tuesday’s advance ultimately reflected a return to semiconductor stocks rather than a broad-based risk-on move. The rebound in chipmakers was sufficient to lift all three major averages and give the technology-heavy Nasdaq a clear advantage, but participation elsewhere remained uneven.

The subdued tone could change quickly on Wednesday, with two major catalysts capable of shaping the market’s next move. The July Personal Income and Spending report will provide the latest reading on the Federal Reserve’s preferred PCE inflation gauge, potentially influencing expectations for the September policy decision. Then, after the closing bell, NVIDIA will report quarterly results.

Following weeks of pronounced volatility across semiconductor and AI-related stocks—and NVIDIA’s recent seven-session losing streak—the company’s earnings, guidance, and commentary on AI demand could provide a critical test for the semiconductor rebound and the broader AI investment trade.

Our FTinvest 11 model portfolio declined 0.79% to close at 1,013.63, marking its fourth consecutive losing session and extending the recent pullback. The index is now approximately 7.5% below its all-time closing high of 1,096.33, leaving it noticeably further from July’s record territory but still short of the 10% threshold generally associated with a market correction.

FTinvest 11 remains up approximately +9.21% year-to-date, with the latest decline bringing its 2026 return back below double digits. Since closing at 1,074.36 on August 19, the portfolio has fallen approximately 5.7%, reflecting a clear deterioration in short-term momentum.

Importantly, the composition of today’s decline differed from Friday’s selloff. The single portfolio component that had previously suffered a sharp 15.9% decline recovered part of those losses today, providing a positive contribution to the index. However, that rebound was more than offset by weakness across all of the portfolio’s other components, resulting in a further decline for FTInvest 11 overall. This suggests that today’s pressure was considerably broader across the portfolio rather than being driven primarily by the previously troubled holding.

Despite the recent setback, FTInvest 11 continues to maintain a meaningful positive return for 2026 while following its disciplined, value-driven approach to long-term capital appreciation.