S&P 500 closes higher as Nvidia gains, traders shake off Trump's latest Fed salvo

Stocks finished in positive territory Tuesday.

The Nasdaq Composite advanced 0.44% to end at 21,544.27, and the S&P 500 gained 0.41% to close at 6,465.94. The Dow Jones Industrial Average climbed 135.60 points, or 0.30%, to finish the day at 45,418.07.

— Sean Conlon

The upcoming nonfarm payrolls report due out next Friday may be on the "soft side," according to Jeffrey Roach, chief economist at LPL Financial.

"Consumers are feeling a softening job market," he said. "We should expect upcoming nonfarm payrolls numbers to be on the soft side. I expect August payrolls to be roughly 60,000 net of revisions."

Economists polled by FactSet are currently forecasting that nonfarm payroll growth for August will be 110,000, up from 73,000 in July.

— Sean Conlon

The Federal Reserve said on Tuesday that it's going to "abide by any court decision" regarding whether President Donald Trump can legally remove Fed Governor Lisa Cook from the central bank's board of governors.

"Cook has indicated through her personal attorney that she will promptly challenge this action in court and seek a judicial decision that would confirm her ability to continue to fulfill her responsibilities as a Senate-confirmed member of the Board of Governors of the Federal Reserve System," the Fed said in a statement from a spokesperson. "As always, the Federal Reserve will abide by any court decision."

— Dan Mangan, Sean Conlon

President Donald Trump said on Tuesday that he'll have a "majority" of his nominees on the Federal Reserve's board of governors "very shortly" to push for lower interest rates after he told Fed Governor Lisa Cook that she's fired.

"We'll have a majority very shortly," he said at a Cabinet meeting. "So that'll be great."

"Once we have a majority, housing is going to swing, and it's going to be great," the president also said. "People are paying too high an interest rate. That's the only problem with us. We have to get the rates down a little bit."

— Kevin Breuninger, Sean Conlon

Treasury Secretary Scott Bessent praised President Donald Trump's actions against the Federal Reserve, claiming that he was restoring public confidence in the central bank.

Bessent's remarks come as Trump is trying to fire Federal Reserve Board Governor Lisa Cook, an unprecedented move that Wall Street sees as a threat to the central bank's independence.

"The Federal Reserve's independence comes from a political arrangement between itself and the American public," Bessent told Trump during a televised Cabinet meeting. "

"Having the public's trust is the only thing that gives it credibility," the secretary said. "And you sir, are restoring trust to government, you are weeding out the waste, fraud and abuse and the old ways of doing things are not good enough."

— Spencer Kimball

The Federal Reserve falling under the sway of the President will translate into negative real yields for the U.S. economy, probably fueling more asset speculation and a renewed round of quantitative easing as the central bank steps in as a buyer of last resort in the Treasury market, according to Bill Blain of London-based Windshift Capital in his "Morning Porridge" newsletter.

Markets now face increased challenges and "the momentum towards a bust feels like it is building," said Blain, a market strategist and former investment banker .

"Trump's de facto sacking of Fed Governor Lisa Cook – paving the way for the presidential capture of the Fed's decision and rate setting process – spells the end of central bank independence," Blain wrote Tuesday. "Easing rates into an inflationary outlook and a still strong employment outlook might be politically expedient, but is likely a bad thing."

Eventually, "The triple whammy of dollar weakness, a Treasury sell-off and a resumption of QE distortions are just one nightmare scenario – but perversely it's one the short-term focused markets will probably welcome, seeing a return of QE as the signal to invest 'bigly' in all kinds of speculative assets," Blain concluded.

— Scott Schnipper

Bank of America sees Lululemon's rough patch as a buying opportunity.

The athleisure retailer's shares have tumbled around 47% so far in 2025, on track for its worst year since 2008. Investors are looking to the company's earnings report expected early next month.

"We think the stock's selloff presents a particularly good opportunity to own a strong growth company with high margins," analyst Lorraine Hutchinson wrote to clients on Tuesday.

While Hutchinson reiterated her buy rating, she cut her price target by $70 to $300. Still, that reflects a more than 48% upside over Monday's closing level.

— Alex Harring

In a Tuesday note, Baird stood by its neutral rating on shares of Tesla. The investment firm's $320 price target implies a potential 8% downside ahead for the stock.

"Balancing de-emphasis of fundamentals with estimates being too high," wrote Baird analyst Ben Kallo. "We are lowering our delivery and regulatory credit estimates for the remainder of 2025, and look for details on robotaxi/Optimus timeline in the meantime."

"The relative lack of emphasis paid to fundamentals over the last several quarters indicates investors are more willing to wait for the longer-term opportunities regarding robotaxi/ Optimus, in our view," Kallo added. "Acknowledging the increased patience, we remain cautious with volume and financial estimates for 2H25 too high and the Automotive business continuing to show signs of weakness."

Shares of Tesla have slipped 14% this year.

— Lisa Kailai Han

Bank of America is moving to the sidelines on spirits producer Constellation Brands, which has already accumulated significant losses this year driven by concerns about how higher tariffs could threaten demand for its beer.

Analyst Peter Galbo downgraded Constellation Brands to underperform from neutral on Tuesday, leading shares to slump about 3% in afternoon trading. Alongside the downgrade, he lowered his price target from $182 to $150, which suggests the stock could fall nearly 8.4% from its latest close.

"We see further downside potential as beer industry consumption remains soft creating risk to sales, margin and multiple. Added risks: 1) core Hispanic demographic remains pressured 2) longer term alcohol consumption trends, & 3) continued capacity buildout in Mexico," Galbo said in a note to clients. "We believe consensus has become complacent and argument of "valuation is cheap" is unwarranted given multiple premium STZ maintains versus TAP despite STZ being a largely landlocked US business."

Shares of Constellation Brands are down 28% year to date.

— Pia Singh

Wall Street is more optimistic about Eli Lilly's chances to bring a competitive weight loss pill to market after the latest update from the drugmaker. Shares are up more than 4% in trading Tuesday, while rival Novo Nordisk's stock is more than 2% lower.

The gain means Lilly shares are pacing for their best day since mid-April. The once high-flying stock has struggled in 2025, with shares down more than 6% year to date.

Lilly said patients with type 2 diabetes who took the highest dose of orforglipron in a clinical trial lost about 10.5% of their body weight after 72 weeks. The placebo group shed 2.2% of their weight over the same period. The results were competitive with Novo Nordisk's comparable study, which showed a 10.4% weight loss in a similiar patient group, Wolfe research analyst Alexandria Hammond said in a research note.

She added, Lilly's drug was well tolerated by most patients. lowered their average A1C scores and showed some "meaningful" cardiovascular risk benefits.

Hammond added that Lilly reiterated its plans to file for approval of the drug to treat obesity by the end of this year.

— Christina Cheddar Berk

• Semtech — The semiconductor maker rallied 17% on better-than-expected second-quarter results and strong third-quarter revenue guidance. The company posted a Q2 profit of 41 cents per share, excluding certain items, on revenue of $27.6 million. Analysts expected earnings of 40 cents per share on revenue of $256.1 million. For the third quarter, Semtech expects revenue of $266 million.
• Cracker Barrel Old Country Store — Shares climbed 4.5%, rebounding after seven straight days of losses on widespread backlash to its new logo and rebranding. On Tuesday, President Donald Trump weighed in on the controversy, saying the restaurant should return to its old logo.
• Paramount Skydance — The media company shed 4%, giving back some of its sharp gains for the month. Paramount shares are up 21% in August.

Read the full list here.

— Fred Imbert

Investors turned to gold-related plays on Tuesday as a safe haven following President Donald Trump's plan to fire Federal Reserve Governor Lisa Cook.

The SPDR Gold Shares ETF (GLD) added around 0.6% in midday trading. By comparison, the broad S&P 500 sat just above its flatline.

The ETF has run circles around the broader market so far in 2025, rallying nearly 29% year to date.

— Alex Harring

Federal Reserve Board Governor Lisa Cook will file a lawsuit over President Donald Trump's plan to fire her, according to her attorney.

"President Trump has no authority to remove Federal Reserve Governor Lisa Cook," Abbe Lowell, her lawyer, said in a statement on Tuesday.

"We will be filing a lawsuit challenging this illegal action," Lowell added.

Stocks did not make notable moves immediately following the news late Tuesday morning.

— Alex Harring, Dan Mangan

Economist Claudia Sahm, creator of the the "Sahm rule" recession indicator, said it was "a very dark day" following President Donald Trump's firing of Fed Governor Lisa Cook.

"Do not forget. It's about control of the Fed. This is a very dark day," Sahm wrote on X.

— Lisa Kailai Han

Small caps outperformed Tuesday, with the Russell 2000 up 0.7% thanks in part to lower short term Treasury yields. By comparison, the major averages were little changed.

— Sarah Min

Consumer confidence came in stronger than expected in August.

The survey of consumer attitudes toward their financial prospects came in at 97.4, according to the index released by the Conference Board on Tuesday. That's better that the 96.5 Dow Jones consensus estimate.

Stocks were marginally higher following the release, with the major averages slightly higher. The Russell 2000 was up 0.5%.

— Sarah Min

Military officials in the Trump administration are "thinking about" the U.S. possibly taking equity stakes in defense contractors like Lockheed Martin, Commerce Secretary Howard Lutnick revealed on Tuesday.

"Oh there's a monstrous discussion about defense," Lutnick said on CNBC's "Squawk Box."

He added that Lockheed is "basically an arm of the U.S. government" given that a large portion of its revenue comes from contracts with the U.S. government.

"They make exquisite munitions," he continued. "But what's the economics of that? I'm going to leave that to my Secretary of Defense and the deputy Secretary of Defense. These guys are on it and they're thinking about it."

Lockheed shares were up more than 1% in morning trading on the heels of Lutnick's comments.

— Kevin Breuninger, Sean Conlon

Stocks began Tuesday's session in the red.

The S&P 500 ticked lower by 0.1%, as did the Nasdaq Composite, just after 9:30 a.m. ET. The Dow Jones Industrial Average also fell 55 points, or 0.1%. 

— Sean Conlon

U.S. durable goods orders in July came in better than anticipated.

Last month, orders fell 2.8%, while economists polled by Dow Jones had estimated a decline of 4.1% on the month.

When excluding transportation, orders saw an increase of 1.1%, beating the 0.3% that economists had expected.

— Sean Conlon

These are the stocks moving the most in premarket trading:

• EchoStar — The telecommunications stock surged 66% after AT&T said it would buy some wireless spectrum licenses from EchoStar for $23 billion.
• Eli Lilly — The pharma giant rose 2% after the company's weight loss pill, orforglipron, cleared another late-stage trial.
• Advanced Micro Devices — The semiconductor stock gained 2% following an upgrade to buy from hold at Truist.

Read the full list of stocks moving here.

— Lisa Kailai Han

A strengthening relationship between hyperscale customers and Advanced Micro Devices could boost the stock over the coming months, according to Truist.

Shares rose more than 2% in the premarket Tuesday after analyst William Stein upgraded the semiconductor stock to buy from hold. Its updated price target also implies more than 30% upside from Monday's closing price.

"For the last several years, our industry contacts (component buyers/sellers) have told us that hyperscale customers deploying [artificial intelligence] were experimenting with AMD's technology as a 'price check' to NVDA (Buy), nothing more," he wrote. "Over the last month or so, contacts have increasingly noted that hyperscalers are working with AMD in a partnership manner, expressing true interest in deploying AMD at scale."

This comes as shares have already surged in recent months, gaining about 56% in the last six. The S&P 500, by comparison, has gained more than 8% in that period.

— Sean Conlon

Shares of EchoStar soared more than 72% after the company announced AT&T was buying the company's spectrum licenses for $23 billion.

"This acquisition bolsters and expands our spectrum portfolio while enhancing customers' 5G wireless and home internet experience in even more markets," AT&T CEO John Stankey said in a statement.

The deal is expected to close in mid-2026.

— Fred Imbert

Eli Lilly shares rose nearly 2% in the premarket after the company's weight loss pill, orforglipron, cleared another late-stage trial. The higher dose of the pill helped patients lose 10.5% of their weight on average at 72 weeks, compared to just 2.2% weight loss in the placebo group.

— Annika Kim Constantino

European stock markets tumbled on Tuesday morning, pulled down by Paris's CAC 40 index, which lost around 2% in morning trade. The regional Stoxx 600 index was 0.75% lower at 10:15 a.m. in London.

Investors are assessing the potential for France to be plunged into another period of political instability after Prime Minister Francois Bayrou called a confidence vote for Sept. 8 over his contentious budget cut plans. Analysts flagged the potential for French assets to suffer after the country's main opposition parties said they would not back Bayrou, raising fears of a government collapse.

— Jenni Reid

Asia-Pacific markets mostly fell Tuesday, as investors weighed U.S. President Donald Trump's escalatory rhetoric on tariffs and assessed his move to fire Federal Reserve Governor Lisa Cook.

Trump reportedly warned of "200% tariffs or something" on China if it does not export rare-earth magnets to the U.S, while also threatening levies on countries that do not remove digital taxes and related regulations.

Hong Kong's Hang Seng index led losses in the region. The benchmark dropped 1.18% to end the day at 25,524.92, while mainland China's CSI 300 moved down 0.37% to 4,452.59, snapping its four-day winning streak.

Investors also assessed the meeting between South Korean and U.S. presidents over fleshing out the trade deal announced last month that stipulated 15% tariffs on the Asian country's exports to the U.S.

The Kospi index closed 0.95% lower at 3,179.36, while the small-cap Kosdaq was up 0.46% to 801.66.

In Japan, the Nikkei 225 declined by 0.97% to 42,394.40 while the broader Topix index fell 1.08% to 3,071.99.

Australia's S&P/ASX 200 benchmark dropped 0.41% to 8,935.60.

Over in India, the benchmark Nifty 50 declined by 0.66%, while the BSE Sensex index lost 0.65% as of 2 p.m. Indian Standard Time (4:30 a.m. ET).

— Amala Balakrishner

The U.S. dollar index weakened by 0.16% as of 9:40 p.m., following news of U.S. President Donald Trump firing Federal Reserve Governor Lisa Cook.

Meanwhile, yields on 10-year U.S. Treasuries rose nearly 2 basis points to 4.2887%, while gold — which is a safe haven asset investors seek in times of tumult — strengthened by 0.17% to $3,372.

— Amala Balakrishner

President Donald Trump said he is removing Federal Reserve Governor Lisa Cook, citing "false statements" on "one or more mortgage agreements."

In the wake of the report, the dollar weakened against both the yen and the euro. The ICE U.S. Dollar Index fell 0.3% immediately after the news broke.

Cook, who was nominated by President Joe Biden in 2022, is the first African-American woman to serve as a Federal Reserve governor.

Trump's decision to remove her puts the central bank into unchartered territory and threatens its independence as Congress has said a president can only fire a Fed governor "for cause." The law doesn't specify what types of actions would trigger such an action.

"I have determined that there is sufficient cause to remove you from your position," Trump said in a letter to Cook posted on his Truth Social platform.

—Christina Cheddar Berk

Shares of Interactive Brokers Group rose more than 4% in extended trading, after the S&P Dow Jones Indices said the online brokerage is set to join the S&P 500.

Interactive Brokers will replace Walgreens Boots Alliance in the broader index. The changes will take effect prior to the market open on Thursday, Aug. 28.

On the other hand, shares of competitor Robinhood Markets slid marginally, down 0.4%, after getting passed over for inclusion.

— Sarah Min

U.S. stock futures were little changed on Monday night.

Dow Jones Industrial Average futures rose by 39 points, or 0.09%. S&P 500 and Nasdaq 100 futures rose 0.06% and 0.02%, respectively.

— Sarah Min