Let's start with a little surprise.
Yes, the Dow Jones Industrial Average jumped 846 points on Friday as Federal Reserve Chairman Jerome suggested an interest-rate cut might be coming in September.
No, the Dow's big gain was not led by Nvidia (NVDA) , which reports earnings next week, or Microsoft (MSFT) , or Apple (AAPL) or Amazon.com (AMZN) .
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So, you ask, which stocks produced all those points? Look no further than Goldman Sachs (GS) , Caterpillar (CAT) , Home Depot (HD) and American Express (AXP) .
Their gains produced 429 points alone, or more than half of the Dow's total gain. The index ended the day at a record close of 45,632.
Nvidia's Dow contribution — Its 3-point gain, or 1.7% — added 18.5 points to the index.
(The basic reason Nvidia had such a small gain is that the share prices of the four are much higher than Nvidia's, and the Dow is a price-weighted index. The higher the stock price, the more impact it has on the average.)
Friday's rally pushed the blue-chip index to both a 52-week high and a record close. But the Dow already has enjoyed three larger rallies in this volatile year, at least in points:
- 2,963 points on April 9.
- 1,017 points on April 22.
- 1,161 points on May 12.
Nvidia is expected to report blow-out earnings this week
But weep not for Nvidia, which ended Friday at $177.99, up $3.01 on the day.
The stock attracts huge amounts of attention because it is the world's most valuable company by market capitalization: $4.34 trillion.
Wednesday brings its moment to shine. Its fiscal second-quarter earnings come out after the market close.
Related: Tesla's latest move could make it tougher to sell more Cybertrucks
Investors are expecting big results. No fewer than nine investment houses raised their price targets on the shares over the next 12 months to an average $194, or 9% from Friday's close.
Nvidia is expected to report revenue up 54% from a year ago to $46 billion. Earnings per share: 98 cents up 44.1%
“What you’re seeing is the recognition that growth at Nvidia is rock solid,” Brian Mulberry, client portfolio manager at Zacks Investment Management, told Bloomberg News. “Analysts are raising projections because they simply need to: The stock is not going to slow down.”
Nvidia shares are up 32.5% this year and have climbed 105% from their post-April/tariff low.
That big Nvidia recovery added more than 180 points — roughly 11% — to the 1,632 points the Standard & Poor's 500 Index gained in that time frame, Bloomberg noted.
The shares opened lower Friday before Powell's speech. The Information news service reported that the company had asked component suppliers to halt production related to its H20 AI chip designed for the Chinese market.
Related: Nvidia earnings face high bar on data-center demand, China deal
China apparently wants Chinese companies to make the chip or its equivalent.
The chip was designed because the Trump Administration has been reluctant, for national security reasons, to let China to buy its most powerful Blackwell chips.
Later, President Trump agreed to approve the sale of chips from Nvidia and rival Advanced Micro Devices (AMD) to China in exchange for the government's collecting 15% of the sales revenue.
Investors will want to know more about this during the conference call CEO Jensen Huang will hold after the earnings come out.
More on Technology
- The US Could Wind Up Owning More Than 10% of Intel
- Nvidia quietly buys more stock in AI infrastructure favorite
- Soros supercharges Nvidia stake, loads up on AI plays
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Where the indexes stand after Friday
- S&P 500: Up nearly 10% in 2025 and 2% so far in August.
- The Nasdaq Composite: Up 11.3% on the year and 1.8% for the month.
- Dow industrials: Gained 7.3% in 2025 to date and 3.4% in August.
The worry before the Powell speech on Friday was that the stock market was getting overvalued. Using relative strength index as a way to consider if something is overvalued, the short answer is: Not right now.
S&P 500. The index had an RSI value of 62.78 on Friday, with 70 or higher suggesting it's overbought. On July 28, the RSI was 76.29.
Dow industrials. The Dow's RSI was 67.62 on Friday, down from 75.31 on July 28.
Nasdaq Composite. The RSI for the Nasdaq was 59.14 on Friday, down from 76,04 on July 28.
Important earnings ahead this week
Monday: Online Chinese retailer Pinduoduo (PDD) . Aircrafter component manufacturer Heico (HEI) and (HEI.A) .
Tuesday: Bank of Montreal (BMO) , Database developer MongoDB (MDB) . Cloud software developer Okta (OKTA) .
Wednesday: Cybersecurity company Crowdstrike Holdings (CRWD) . Data storage company Snowflake (SNOW) . Travel company Trip.com (TCOM) .
Thursday: Dell Technologies (DELL) . Chipmaker Marvell Technology MRVL. Dollar General (DG) .
Friday: Alibaba Group (BABA) .
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