Stock market today: S&P 500 climbs as health care, tech gain; Nvidia earnings loom

Investing.com -- The S&P 500 closed higher Tuesday, as rising health care and tech stocks helped offset concerns about Federal Reserve independence just a day ahead of Nvidia’s quarterly earnings. 

At 4:00 p.m. ET (20:00 GMT), the Dow Jones Industrial Average rose 135 points, or 0.3%, while the S&P 500 index climbed 0.4%, and the NASDAQ Composite added 0.4%.

Fed independence in spotlight 

Trump released a letter on social media announcing Cook’s removal late Monday, effective immediately.

Trump said the firing was tied to allegations of mortgage fraud, and that there was “sufficient cause” for her removal. The allegations were raised earlier in August by Federal Housing Finance Agency Director William Pulte. 

Cook denied the allegations, and had stated that she would not be bullied out of her position. Cook is set to file a lawsuit against Trump’s move to dismiss her, but the president said on Tuesday that he was prepared for a legal battle.  

But Trump’s announcement of her removal marks his latest attack against the Fed, with the president seen repeatedly attempting to exert more influence over the central bank. Cook is a member of the Fed’s seven-member rate-setting board. 

Trump’s moves sparked heightened uncertainty over the Fed’s independence, with political interference in the central bank threatening to undermine U.S. economic credibility. The Fed has traditionally operated outside the government’s sphere of influence. 

Trump had earlier this year also attempted to remove Fed Chair Jerome Powell, who had largely rejected the president’s calls to cut rates immediately. 

Eli Lilly leads jump in health care stocks

Eli Lilly and Company (NYSE:LLY) jumped more than 5% after reporting that its once-daily weight loss pill met its primary and secondary goals, paving the way the pharma giant to submit applications globally for regulatory approval of the drug this year. 

"Given the profile of orforglipron from an efficacy/tolerability perspective and the ease of manufacturing, we believe that orfor could represent a double-digit billion dollar opportunity," Truist Securities said in a Tuesday note. 

Regeneron Pharmaceuticals Inc (F:REGN), and Henry Schein Inc (NASDAQ:HSIC) were also in the ascendency, helping to lift health care stocks. 

Durable goods orders, Consumer confidence beat expectations 

Consumer confidence fell to a reading of 97.4 in August from an upwardly revised 98.7 the prior month, though the decline was still less than the expected 96.4. 

New orders for key U.S.-manufactured capital goods increased more than expected in July, suggesting business spending on equipment got off to a strong start in the third quarter.

Non-defense capital goods orders excluding aircraft, a closely watched proxy for business spending, surged 1.1% last month after a revised 0.6% decline in June, the Commerce Department’s Census Bureau said on Tuesday.

However, orders for durable goods, items ranging from toasters to aircraft meant to last three years or more, fell 2.8%, pulled down by fewer commercial aircraft bookings. Durable goods orders decreased 9.4% in June. 

The better-than-expected economic data came just as investors continued to price in a September rate cut. 

"We now expect the FOMC to cut the funds rate by 25bps in September and follow with quarterly cuts of 25bps to a terminal of 2.75-3.0% by end-2026," Morgan Stanley said in a recent note.

Looking ahead to Thursday, meanwhile, the second estimate of second-quarter GDP and the latest weekly jobless claims are also due.

HSBC economists expect second-quarter GDP growth to be revised to an annualized 3.2% from the initial 3.0% estimate. In a recent note, they said that consumer sentiment will “remain subdued” in August, while July durable goods orders are likely to show a contraction.

Nvidia’s earnings loom large; Apple announces launch date for widely expected iPhone 17

Investors also turned largely cautious before closely-watched earnings from artificial intelligence major Nvidia (NASDAQ:NVDA), due on Wednesday. The company is regarded as a bellwether for AI and tech. 

Nvidia’s earnings come amid growing doubts over the long-term prospects of AI– doubts which caused a sharp selldown in tech stocks last week. 

Its results arrive as the second-quarter earnings season winds down, with S&P 500 profits tracking a 12.9% gain from a year earlier—well above the 5.8% rise expected at the start of July, according to LSEG IBES.

Nvidia is projected to report a 48% jump in per-share earnings on revenue of $45.9 billion for its fiscal second quarter, LSEG data show.

Apple Inc (NASDAQ:AAPL) was 1% higher after its invite to media and analysts for a launch event due Sept. 9, lifted expectations that the company is set to unveil its new iPhone in a few weeks.

Peter Nurse, Ambar Warrick contributed to this article