Dow eyes fresh highs as Nvidia gets set to report earnings amid AI bubble fears

Jason Ma is the weekend editor at Fortune, where he covers markets, the economy, finance, and housing.

Stock futures edged up on Sunday evening as Wall Street looks ahead to another big week that will feature earnings from AI chip leader Nvidia and another inflation update.

Markets are coming off a monster rally on Friday, when Federal Reserve Chairman Jerome Powell opened the door to a rate cut next month.

Futures tied to the Dow Jones Industrial Average rose 24 points, or 0.05%. S&P 500 futures were up 0.05%, and Nasdaq futures added 0.06%. On Friday, the Dow hit a new all-time high, while the S&P 500 and Nasdaq closed in on their records.

The yield on the 10-year Treasury was flat at 4.256% after diving Friday on rate-cut expectations. The U.S. dollar was down 0.02% against the euro and flat against the yen.

Gold fell 0.13% to $3,413.80 per ounce. U.S. oil prices rose 0.2% to $63.79 per barrel, and Brent crude added 0.15% to $67.83.

Friday’s stock surge came after a big selloff that was led

That’s after a recent report from MIT found that 95% of AI pilot programs at businesses are failing to produce much of a return.

Adding to those concerns were remarks from OpenAI CEO Sam Altman, who drew a parallel between today’s AI frenzy and the 1990s dot-com bubble.

Wall Street’s faith in the staying power of AI as an investment thesis will be put to the test when Nvidia reports quarterly earnings after the close on Wednesday.

The report also comes after Nvidia and AMD agreed to an unprecedented deal where they give the federal government a 15% cut of their chip sales to China.

For now, demand from U.S. companies remains high as so-called hyperscaler tech giants Alphabet, Microsoft, Amazon, and Meta Platforms alone are expected to deploy $400 billion in capital expenditures this year, and most of that is going to AI.

On Friday, the Fed’s preferred inflation gauge is due as policymakers wait and see how much of an effect on inflation President Donald Trump’s tariffs are having.

Earlier updates on the consumer price index and the producer price index were mixed, and analysts expect the personal consumption expenditures index for July to rise 0.2% on a monthly basis and 2.6% on a yearly basis, the same annual rate as June.

But the core PCE is seen climbing 0.3% on a monthly basis and 2.9% on a yearly basis, accelerating from June’s 2.8% annual rate.

Still, some Fed officials, including Powell, have indicated that tariff-related impacts on inflation may be short term and that more attention should go to the labor market, which has shown signs of weakening.