Wall Street Retreats as Investors Anticipate Nvidia Results and Fed Minutes

On Tuesday, U.S. stocks saw a decline, pausing a recent winning streak, as investors eagerly awaited Nvidia's quarterly results and the release of the Federal Reserve's minutes from its latest policy meeting. The S&P 500 and Nasdaq, which recently hit their highest closing levels in over three months, faced a setback, putting an end to a five-day winning streak.

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Roosevelt Bowman, Senior Investment Strategist at Bernstein Private Wealth Management, noted that equities were retracing some gains but highlighted reduced uncertainty around the Federal funds rate and interest rate volatility as supportive factors going into the year-end.

Big Tech stocks, crucial contributors to the S&P 500's year-to-date gains, faced a pivotal moment as Nvidia, a leading chip designer, prepared to report third-quarter results. The focus was not only on a strong revenue forecast but also on the potential impact of expanding U.S. restrictions on chip sales to China. Nvidia's shares slipped 1.8%, and other megacap stocks, including Microsoft and Amazon.com, also experienced declines.

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Before Nvidia's report, investors looked to the Federal Reserve's November meeting minutes for insights into the central bank's monetary policy stance, especially after recent indications of easing consumer and producer prices. The Dow Jones Industrial Average, S&P 500, and Nasdaq Composite were all in negative territory as the market awaited crucial information.

Additionally, downbeat corporate updates from U.S. retailers, including Lowe's, Best Buy, and Kohl's, painted a concerning picture for consumer spending. Lowe's fell 2.8%, contributing to a 1.9% drop in the S&P 500 retail sub-index.

As the week progressed with light economic data and thin trading volumes ahead of the Thanksgiving holiday, market dynamics were influenced by factors such as the fully priced expectation of the Fed maintaining interest rates in December and speculation about a possible rate cut in March.

At 11:41 a.m. ET, the Dow Jones Industrial Average was down 0.28%, the S&P 500 was down 0.39%, and the Nasdaq Composite was down 0.86%. Declining issues outnumbered advancers on both the NYSE and Nasdaq, reflecting a cautious sentiment in the market.

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