Stock Market Today: Markets Close Lower as Investors Await Nvidia Earnings

Major Indexes Retreat After Tuesday’s Rally

U.S. stock markets closed lower on Wednesday, May 28, 2025, as investors awaited highly anticipated earnings from artificial intelligence chip giant Nvidia. The broad S&P 500 index fell 0.6% to close at 5,888.55, while the Dow Jones Industrial Average dropped 244.95 points, or 0.6%, to settle at 42,098.70. The tech-heavy Nasdaq Composite declined 0.5% to end at 19,100.94.

Today’s pullback follows Tuesday’s strong rally when the Dow jumped more than 700 points after President Donald Trump announced a delay in implementing 50% tariffs on European Union imports until July 9.

Nvidia Earnings Take Center Stage

After the closing bell, Nvidia (NVDA) reported its first-quarter results, which were closely watched as a barometer for the ongoing AI boom. The chipmaker reported revenue of $44.1 billion, beating analyst estimates of $43.3 billion, and adjusted earnings per share of $0.96, exceeding the expected $0.93.

However, the company highlighted significant challenges related to U.S. export restrictions, noting an $8 billion expected revenue impact in the second quarter from the Trump administration’s ban on sales of its H20 AI chips to China. This follows a $2.5 billion revenue hit in the first quarter.

“The $50 billion China market is effectively closed to US industry,” Nvidia CEO Jensen Huang stated. “The H20 export ban ended our Hopper data center business in China. We cannot reduce Hopper further to comply.”

Nvidia shares rose approximately 4% in after-hours trading following the report.

Other Corporate News

Several other companies made headlines on Wednesday:

– Identity management software company Okta (OKTA) plunged more than 16% despite topping analysts’ estimates, as the company noted increasing customer caution.

– Abercrombie & Fitch (ANF) shares surged nearly 15% after the retailer beat earnings expectations.

– Dick’s Sporting Goods (DKS) gained 1.6% after beating estimates and maintaining its full-year forecast.

– Macy’s (M) closed 0.5% lower after trimming its full-year earnings guidance, citing tariff uncertainties despite reporting a smaller-than-expected sales decline.

– GameStop (GME) dropped 11% after disclosing in a filing that it had purchased 4,710 bitcoins worth approximately $513 million.

Fed Minutes Reveal Concerns About Stagflation

The Federal Reserve released minutes from its May 6-7 meeting on Wednesday, revealing that policymakers acknowledged “difficult tradeoffs” in the months ahead. The central bank recognized that Washington policies were likely to increase both inflation and unemployment, with staff projections pointing to elevated recession risks.

These concerns support the view that the Fed will likely keep interest rates unchanged until December, when a potential cut is anticipated.

Upcoming Market Events

Investors should watch for several key economic events in the coming days:

– Thursday, May 29: Weekly unemployment claims data and pending home sales will be released. South Korea’s central bank is expected to announce an interest rate decision.

– Friday, May 30: The U.S. will release the Core PCE Price Index, the Fed’s preferred inflation gauge, along with personal income and spending data. Japan will publish Tokyo CPI, unemployment rate, and industrial production figures.

– Saturday, May 31: China will release its National Bureau of Statistics PMI data, which will help assess the impact of U.S. tariffs on the Chinese economy.

Market Outlook

The market’s focus remains on inflation concerns and the potential economic impact of tariffs. According to recent data, U.S. consumer confidence rebounded in May as Americans reacted to Trump thawing trade tensions with China earlier in the month.

Nations are now racing to cut deals with the Trump administration to avoid planned U.S. tariff hikes, with India reportedly the latest to offer to lower its own tariffs on some American products.

As Rich Saperstein, chief investment officer of Treasury Partners, noted on CNBC: “It’s important for investors to look past the tariff turmoil and look at the environment where we’ll have deregulation, more onshoring… The environment post-tariffs will be a great environment for investing.”

However, he cautioned that “in between that, we have uncertainty, which could cause a slowdown in the next two quarters.”