Wall Street ended the week on a cautious note as markets dipped, tech stocks faltered, and investors braced for fresh inflation data.
Beyond the markets, political and corporate drama dominated headlines from Trump’s unprecedented attempt to oust a Fed governor and a court ruling against his tariffs, to Nvidia’s blockbuster earnings and Elon Musk’s latest clash with regulators.
A glance at the biggest stories that captured attention this week.
Tech drags as investors play safe
Wall Street had a crazy week, with mixed signals making things a bit uncertain. The main indexes were all down: the Dow Jones fell 92 points, the S&P 500 slipped 0.6%, and the Nasdaq dropped 1.2%.
The tech sector took the biggest hit, with big names like Nvidia, Super Micro Computer, and Broadcom pulling things down as investors got a bit defensive before new inflation numbers came out.
Instead of big tech, investors seemed to prefer safer bets.
Consumer staples and value stocks did better, a clear sign of the cautious mood as the market heads into September, which is often a tough month.
There were some interesting individual movers, too. Keurig Dr Pepper took a big hit after announcing an acquisition, while Deckers Outdoor had a good week thanks to some new product launches.
Regional banks and chipmakers had a mixed performance, with investors trying to balance the good news from Fed Chair Jerome Powell’s dovish comments against.
Trump vs. the Fed
The Fed vs White House showdown climbed to a different level this week as US President Donald Trump ordered the removal of Federal Reserve Governor Lisa Cook, citing allegations of mortgage fraud as the reason for her dismissal.
This marked the first time a sitting president has attempted to remove a Federal Reserve governor in the institution’s 112-year history.
Trump claimed he had constitutional authority to act, accusing Cook of making misleading statements regarding mortgage agreements.
Cook denied the allegations and pushed back against Trump. She filed a lawsuit seeking to block her termination while claiming that the President doesn’t have the legal authority to remove her.
The lawsuit argues her firing violates federal law, which requires “cause” for removal, a standard generally interpreted as serious misconduct.
The case threatens to challenge longstanding Federal Reserve independence and could reach the Supreme Court, potentially revisiting a historic 1935 decision protecting independent agencies.
Trump’s move is seen as an attempt to increase control over the central bank, intensifying political tensions.
The White House defended the firing, while economists and officials caution that such interference risks economic stability. Cook remains on the board pending court proceedings. Read full report here
AI demand powers Nvidia’s record quarter
Nvidia had a fantastic second quarter, blowing past expectations with $46.7 billion in revenue. That’s a huge jump, up 56% from this time last year and 6% from the last quarter.
The company’s earnings per share (EPS) were also strong at $1.04, beating the $1.01 forecast.
The real story here is the data center business, which saw a massive 56% growth. This is Nvidia’s bread and butter right now, thanks to the soaring demand for AI infrastructure.
The company’s gross margin held strong at 72.4%. CEO Jensen Huang pointed to the rapid adoption of their new Blackwell AI platform as a key driver behind the AI boom.
Despite all the good news, some analysts were expecting even more from the data center revenue, which caused a slight dip in the stock after hours.
Looking ahead, Nvidia is optimistic, forecasting about $54 billion in revenue for the third quarter.
However, this doesn’t include potential shipments of their H20 chips to China, a situation complicated by ongoing regulations. Read full report here
SEC accuses Musk of late Twitter disclosure
In another Musk vs US administration saga, Elon Musk is pushing back against the SEC.
On Thursday, his legal team filed a motion to dismiss a lawsuit from the US Securities and Exchange Commission, which claims he was late in reporting his stake in Twitter back in 2022.
The SEC alleges Musk waited 11 extra days to reveal his initial 5% ownership, allowing him to snap up more shares at a lower price and pocket $150 million.
Musk’s lawyers argue the delay was simply a mistake and was fixed quickly.
They insist there was no intent to mislead anyone or harm investors. His filing goes even further, accusing the SEC of overstepping its authority and unfairly targeting him, calling the lawsuit a waste of the court’s time.
Ultimately, Musk is asking the court to throw the case out entirely.
Court curbs Trump’s tariff powers
In the latest blow to President Donald Trump, a US appeals court on Friday ruled that most of his tariffs are illegal.
In a 7-4 decision, the court said Trump overstepped his authority under a law meant for emergency economic powers, arguing that the power to impose tariffs belongs to Congress, not the President.
The ruling strikes down the “reciprocal” tariffs he had placed on many countries, including a 10% blanket tariff on nearly all U.S. trading partners.
While the ruling is a significant setback, the tariffs won’t disappear immediately.
The court has given the Trump administration until October 14 to appeal to the Supreme Court.
Trump has already vowed to fight the decision and says he expects the Supreme Court to rule in his favor. Read full report here
The post Weekly wrap: markets wobble, Trump battles Fed, Nvidia smashes records, Musk faces SEC heat appeared first on Invezz
