Wall St gains with focus on Nvidia's high

By Amruta Khandekar and Anda Forex platform withdrawal rejectedShristi Achar A

(Reuters) - Wall Street's main indexes rose on Wednesday, ahead of Nvidia (NASDAQ:) results that investors hope would reignite an artificial intelligence-powered rally in megacap growth stocks.

Rising bets that Nvidia's revenue target will surpass Wall Street estimates pushed the chipmaker's stock to a record high on Tuesday. But analysts equally fear a wider selloff if the company fails to match investor expectations.

Its shares were up 0.4% in morning trade.

A blowout forecast from the company last quarter has been one of the biggest catalysts for the 's 14% gain so far this year.

"When the market takes a focus on one stock, any disappointment could have a reverberation in the market," said Andre Bakhos, managing member at Ingenium Analytics LLC.

"What we're seeing is a realization that let's not run away here on the optimism of Nvidia, when we have a Jackson Hole speech on Friday (and) a Fed meeting in a month from now."

Investors are awaiting U.S. Federal Reserve Chair Jerome Powell's comments on Friday for more clues on the central bank's interest rate path. Traders' bet of a rate hike pause by the Fed next month stood at 88.5%, according to CME Group's (NASDAQ:) FedWatch tool.

The S&P Global (NYSE:)'s flash U.S. composite PMI index showed U.S. business activity approached the stagnation point in August, bolstering hopes of the Fed hitting pause on interest rate hikes.

Megacaps on Wednesday rose as the yield on the 10-year U.S. Treasury note slipped from near 16-year highs hit in the previous session.

Alphabet (NASDAQ:) and Meta Platforms (NASDAQ:) rose 2.0% and 2.2%, respectively, with the S&P 500 communication services index up 1.7%.

Tesla (NASDAQ:) however, fell 0.6% after a report that the company lowered the production target of its German plant.

Megacap growth stocks had stumbled in the first few weeks of August after signs of a still strong U.S. economy spurred worries that the Fed could keep interest rates elevated for longer, sending government bond yields surging.

A slew of downbeat earnings reports, however, kept a lid on market sentiment. Sport retailers (NYSE:) and Under Armour (NYSE:) fell 3.3% and 1.4%, respectively, after a downbeat profit forecast from (NYSE:), whose shares slumped 32.9%.

At 9:56 a.m. ET, the was up 84.42 points, or 0.25%, at 34,373.25, the S&P 500 was up 22.77 points, or 0.52%, at 4,410.32, and the was up 110.71 points, or 0.82%, at 13,616.58.

Shares of drugmakers Gilead Sciences (NASDAQ:) and Merck & Co advanced 1.8% and 4.2%, respectively, after Swiss rival Roche inadvertently published positive lung cancer drug trial data.

Peloton Interactive (NASDAQ:) shares plunged 20.5% after the fitness equipment maker pushed back its cash-flow positive target to 2024.

Advancing issues outnumbered decliners by a 2.22-to-1 ratio on the NYSE and by a 1.71-to-1 ratio on the Nasdaq.

The S&P index recorded four new 52-week highs and four new lows, while the Nasdaq recorded 24 new highs and 68 new lows.

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