Nasdaq leads stocks higher as Nvidia earnings and inflation data approach

Markets don’t often hand investors two potential catalysts on the same day. This week, they’re getting both: Nvidia’s fiscal second-quarter earnings and the July Personal Consumption Expenditures price index, the Federal Reserve’s preferred measure of inflation, landing back-to-back on August 26. Ahead of those releases, the Nasdaq Composite led a broad advance on August 25, with tech shares recovering ground after a rough patch driven by chip-stock anxiety.

What Wall Street is watching from Nvidia

Analyst consensus heading into the print is aggressive. The street is modeling adjusted earnings per share of $2.09 for the quarter, roughly double what Nvidia posted in the same period a year ago.

On the revenue side, expectations sit around $92 billion, a year-over-year increase of approximately 97%. To put that in perspective: Nvidia would be nearly doubling its top line in twelve months, driven almost entirely by insatiable demand from data centers and artificial intelligence infrastructure buildout.

A beat on both EPS and revenue, combined with strong forward guidance, would likely extend the Nasdaq’s recent momentum. A miss, or even guidance that merely meets expectations rather than surpassing them, could rattle the broader tech complex quickly. The Nasdaq had already logged a 0.76% decline in a recent session on chip-stock jitters, a reminder that sentiment in the sector can reverse sharply.

CrowdStrike is also reporting on the same day, adding another variable for anyone running a tech-heavy portfolio.

The PCE print and what it means for rates

The July Consumer Price Index, released on August 12, showed inflation running at 3.4% year-over-year. The PCE tends to run slightly cooler than CPI, and the prior month’s PCE reading came in at 3.7% year-over-year. Investors will be parsing the July PCE to see whether that trajectory is moving in the right direction, or whether sticky services inflation is keeping the number elevated.

The Federal Reserve doesn’t set policy based on CPI. It watches PCE. That distinction matters a great deal right now, because the path of interest rates over the next six to twelve months depends heavily on whether the Fed sees enough progress on inflation to justify easing. A PCE print that comes in above expectations could push rate-cut timelines further out. A softer number would likely do the opposite, giving equities a tailwind.

Context and what to watch next

The Nasdaq’s August 25 advance came after a period of mixed performance for the index. The 0.76% drop tied to chip-stock concerns had rattled momentum, and the rebound on the 25th reflected investors repositioning ahead of the key catalysts rather than any new fundamental development.

Nvidia has become something close to a proxy for the entire AI trade. A strong print tends to lift semiconductor peers, cloud providers, and enterprise software names in its wake. The $92 billion revenue estimate reflects expectations that AI capital expenditure is translating into real revenue at the hardware layer.

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