NEW YORK, September 1 — Nvidia’s upcoming earnings report loomed large as U.S. stocks edged lower on Wednesday, August 26, 2026, with investors weighing fresh inflation data against expectations for the AI chipmaker. The Dow Jones Industrial Average fell 0.2%, the S&P 500 declined 0.1%, and the Nasdaq Composite lost 0.3%. Five of the 11 S&P 500 sectors finished higher, led by energy, while consumer discretionary stocks recorded the steepest decline.
The modest pullback reflected caution across Wall Street, with traders balancing signs of solid economic activity against renewed concerns that inflation could keep interest rates elevated. Nvidia, the artificial-intelligence chipmaker, was scheduled to report its fiscal second-quarter results after the closing bell.
Analysts expected adjusted earnings of approximately $2.09 per share on revenue of about $92.18 billion, which would represent revenue growth of roughly 97% from the same period a year earlier. Nvidia’s own guidance called for revenue of roughly $91 billion, plus or minus 2%, meaning the consensus estimate was only modestly above the company’s forecast. Investors were watching several details beyond headline revenue and earnings, including data-centre sales, gross margins, supply availability, and management’s outlook for the next quarter.
The market’s reaction could depend more on forward guidance than on whether Nvidia beats analysts’ estimates. Strong historical performance has already created high expectations, and a results announcement that merely meets forecasts may not be enough to support the share price.
A strong outlook could revive the AI trade after recent concerns over high valuations, technology borrowing, and the sustainability of corporate data-centre spending. Conversely, signs of slower orders, supply constraints, or weaker customer budgets could put pressure on the Nasdaq and other AI-linked stocks. The latest Personal Consumption Expenditures (PCE) data showed that core PCE inflation rose as expected in July, while headline PCE inflation accelerated.
The core PCE measure excludes food and energy prices and is closely watched by the Federal Reserve when assessing underlying inflation. Economists expected headline prices to rise 0.1% month over month and core prices to increase 0.2%, leaving the annual core inflation rate at 3.3%. The inflation report came alongside durable-goods orders, which increased more than expected in July.
Strong business investment can support economic growth, but it may also make policymakers cautious if robust demand keeps prices elevated. Treasury yields moved higher during the session.
The 2-year yield rose 4 basis points to 4.22%, the 10-year yield increased 4 basis points to 4.66%, and the 30-year Treasury yield gained 3 basis points to 5.19%. Higher yields added pressure to the technology sector, even though the Nasdaq’s decline was relatively limited. Long-term yields remain elevated because investors are concerned about inflation, large government deficits, and the substantial financing requirements of AI infrastructure.
The data reinforced uncertainty over the timing of future interest-rate decisions. If inflation remains persistent, the Federal Reserve may keep interest rates higher for longer or delay potential rate cuts.
Higher rates tend to weigh on growth stocks because investors place a lower present value on future earnings. The article is based on reporting by William Collins, consultant in stock markets, Eurasia Business News, August 26, 2026.
