[Recap] U.S. Stock Market, Aug 26 2026: Dow Snaps 4-Day Win Streak, Nvidia Beats Estimates but Shares Slip After Hours

Hey everyone, Hirokichi here.

Today I’m recapping the U.S. stock market on Wednesday, August 26, 2026. This was the day two of the market’s biggest catalysts landed at once: Nvidia’s earnings report and July’s PCE (Personal Consumption Expenditures) inflation data. The short version: all three major indexes closed slightly lower, in a classic “wait for the big event” kind of session. If you caught last time’s recap (the Aug 24 recap), you’ll remember Nvidia was already on a 7-session losing streak heading into today — so this picks up right where that left off.

Index recap: Dow snaps its win streak, S&P 500 and Nasdaq barely move

Here’s how the three major indexes closed.

・Dow Jones Industrial Average: 53,463.88 (-113.52, -0.21%)
・S&P 500: around 7,676 (essentially flat, roughly -0.01%)
・Nasdaq Composite: 26,130.20 (-21.10, -0.08%)

As the chart below shows, all three indexes finished in the red, though the Dow saw the biggest decline while the S&P 500 and Nasdaq barely budged.

The Dow had climbed for three straight sessions through August 25 on easing Middle East tensions and falling oil prices, so some profit-taking today wasn’t a huge surprise. On top of that, with Nvidia’s earnings due after the closing bell and the morning’s PCE data still fresh, a lot of investors seem to have stayed on the sidelines rather than putting new money to work — which likely capped any upside.

PCE comes in hot: headline +3.7%, core +3.3%, inflation still sticky

July’s PCE index (the Fed’s preferred inflation gauge) released this morning came in at +3.7% year-over-year, a touch above expectations, with a +0.2% month-over-month reading. Core PCE — which strips out volatile food and energy prices — held at +3.3% year-over-year, unchanged from June and right in line with forecasts.

With the headline number running hot and the core reading matching expectations, the market’s takeaway was somewhat mixed: not bad enough to force the Fed’s hand on faster rate cuts, but not calm enough for the Fed to cut with full confidence either. Personal consumption itself grew 0.2% month-over-month, though on a real (inflation-adjusted) basis it was essentially flat. Digging into the breakdown, services spending rose while goods spending fell — a sign that consumers are leaning more toward spending on services than on things. As long as core PCE keeps hovering in the low-3% range, my personal read is that the Fed will stay in no-rush mode.

The main event: Nvidia’s revenue crushes estimates, up nearly 100% year-over-year

After the closing bell, AI-chip giant Nvidia reported quarterly earnings. Revenue came in at $96.2 billion, well above the roughly $91.9 billion analysts had expected, and nearly double what it posted a year earlier. EPS (earnings per share) of $2.22 also topped the $2.08–$2.09 estimate. Data center revenue hit $89 billion versus an $85.4 billion estimate, and guidance for next quarter came in bullish at $108 billion versus a $103.9 billion consensus. Gross margin improved to 75%, up 2.5 percentage points year-over-year.

CEO Jensen Huang said, “AI has reached its inflection point. It’s doing useful work. Its tokens are productive and profitable. Now, compute is revenue” — underscoring his confidence in AI demand. On paper, this was about as clean a beat-and-raise as you could ask for.

Good earnings, lower stock: memory-cost worries linger

And yet, despite the blowout numbers, Nvidia shares actually fell in after-hours trading — dropping roughly 1.5% following the report.

The concerns here predate today’s earnings. As we covered in the last recap, Nvidia had reportedly told major customers it plans to raise prices on AI server chips by as much as 15% next year, citing rising memory costs. While gross margin actually improved this quarter, some investors appear to be focused on how much further memory costs could squeeze profitability going forward. Nvidia shares had already fallen nearly 7% over the seven sessions heading into earnings, and that kind of setup — where good news struggles to get a positive reaction — is exactly the “prove it” market dynamic that seems to have played out again here.

Personally, I think underlying AI infrastructure demand remains genuinely strong, but the stock’s expectations have climbed so high that “great earnings = higher stock price” isn’t a given anymore. Given Nvidia’s sheer size as one of the largest companies in the world, the bar just keeps getting higher with every report. If you’re holding the stock, I wouldn’t overreact to tonight’s move — it’s worth taking some time to watch how the market digests this report over the coming sessions starting August 27.

What to watch this week: Jackson Hole and Fed Chair Warsh’s speech

Heading into the rest of the week, both monetary policy and the AI trade have big events on deck. Here’s what I’m watching.

(1) How chip and AI-related stocks trade on and after August 27 in reaction to Nvidia’s earnings. Given tonight’s drop despite a beat, there’s a real chance we see continued profit-taking near-term.
(2) The Jackson Hole symposium, kicking off Thursday. This annual gathering is closely watched for policy signals, and Fed Chair Kevin Warsh’s speech on Friday will be in focus for any hints on the pace of future rate cuts.
(3) The tug-of-war between sticky inflation (PCE) and still-resilient consumer spending. With inflation staying elevated but spending not collapsing either, the Fed’s decision only gets harder from here.

This should be a week worth watching if you’re dollar-cost averaging into U.S. stocks or U.S. ETFs through NISA. I’ll be keeping an eye on my own holdings and following the week’s moves without overreacting.

Wrap-up

On August 26, 2026, U.S. markets had a quiet day on the surface — the Dow snapped its winning streak and the S&P 500 and Nasdaq barely moved — but the real story broke after the close. Nvidia’s earnings beat expectations on revenue, profit, and guidance across the board, yet the stock still fell after hours, a reminder of just how high expectations for the AI trade have climbed. With the Jackson Hole symposium and Fed Chair Warsh’s speech both on deck this week, it should be an important stretch for reading where markets go next. When things get choppy like this, staying diversified and keeping a long-term view tends to pay off — so I’ll be approaching this week calmly rather than chasing every headline.

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* This article is for informational purposes only and does not recommend any specific investment. Please make investment decisions at your own responsibility.

Let’s keep at it, slow and steady. See you next time!

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