U.S. equities closed mixed, with a chipmaker selloff weighing on the Nasdaq 100, which fell 0.7 percent. The S&P 500 was essentially flat, while the Dow Jones Industrial Average rose 0.4 percent to $51,851.
Nvidia shares declined 1.3 percent to $226.32, dragging the chip sector lower.
Analysts project S&P 500 earnings to rise 25 percent year over year in the third quarter. Strong results and forward guidance could drive sector rotation, particularly if management signals sustained growth momentum.
The U.S. Consumer Price Index report due Wednesday will be critical. Inflation data above expectations could signal the Federal Reserve will move cautiously on rate cuts, while a cooler read might open the door to faster easing. Either way, the CPI components—particularly core services inflation—will shape Fed policy expectations and market positioning into year-end.
If chipmakers continue to underperform into earnings despite the sector's long-term AI tailwinds, it raises questions about near-term valuation. Watch whether Nvidia and peers deliver guidance that justifies current multiples or whether disappointments accelerate the recent rotation out of mega-cap tech.
