Range-bound trading on light volume was the order of the day as market participants weighed the words of several Fed speakers and anxiously anticipated quarterly results from AI bellwether Nvidia ( NVDA ) after tomorrow's close. 

Corporate earnings and guidance might be the market stars these days, but that hardly means interest rate cuts are playing second banana. Several Federal Reserve policymakers on Tuesday reiterated the central bank's message that it will wait for more evidence of waning inflation before enacting its first quarter-point cut to the federal funds rate. 

"In the absence of a significant weakening in the labor market, I need to see several more months of good inflation data before I would be comfortable supporting an easing in the stance of monetary policy," said Fed Governor Christopher Waller at the Peterson Institute for International Economics in Washington.

Waller's remarks echoed those made Monday by New York Fed Governor Philip Jefferson, who said that while the April CPI data was encouraging, it's still too early to tell if the disinflation trend will resume. 

"Federal Reserve speakers emphasized that the current fed funds rate is restrictive and likely to continue supporting disinflation," writes José Torres, senior economist at Interactive Brokers ( IBKR ). "Still, more evidence is needed that price pressures are easing sustainably before the central bank lowers rates."

Much has happened since early May when the Federal Reserve kept interest rates steady amid persistent inflation. Indeed, the April jobs report showed the labor market cooled, while the Consumer Price Index (CPI) gave some relief on the inflation front.

That said, while worries about rate cuts never really fade into the background, traders and investors have something more pressing on their minds right now: Nvidia's ( NVDA ) quarterly results. 

The world's third-most valuable publicly traded company will take its highly awaited turn on the earnings calendar after Wednesday's close. Nvidia ( NVDA ), whose shares have been a long-time market beater, is expected to provide crucial insights into the state of the booming industry for all things AI.

Eli Lilly ( LLY ) gets green light in China

Shares in Eli Lilly ( LLY ) added another 2.7% Tuesday after the pharma giant said Chinese regulators approved its diabetes drug tirzepatide. Lilly, which has seen tremendous success in marketing the drug as a weight-loss medication under the Zepbound and Mounjaro brands, can now compete in China against Novo Nordisk ( NVO ) . NVO's Ozempic treatment won regulatory approval from Chinese authorities in 2021 and has enjoyed rapidly growing sales of the product ever since. 

Note that hedge funds have taken a shine to LLY's potential for accelerating earnings growth. Indeed, Eli Lilly ( LLY ) makes the list of hedge funds top blue chip stocks to buy. 

Tesla soars on electric semi-truck news

In other single-stock developments, Tesla (TSLA) popped 6.7% after the electric vehicle (EV) maker provided an extended update on its long gestating plan to make an electric semi-truck. 

Tesla, one of the Magnificent 7 stocks, said the Tesla Semi is on schedule for production-spec deliveries to customers by 2026. The company also provided additional details on range and payload capacity for the would-be hauler. 

As for the main indexes, the tech-heavy Nasdaq Composite added 0.2% to 16,832, while the broader S&P 500 rose 0.3% to 5,321. The Dow Jones Industrial Average closed below the 40,000 level (see the significance of the Dow at 40K here), gaining 0.2% to 39,872.