U.S. Stocks Fall Despite Nvidia's Strong Performance
U.S. stocks closed lower on Thursday, despite a strong revenue forecast from Nvidia that fueled a surge in its shares. The gains were overshadowed by economic data showing inflation was still a concern, potentially delaying any Federal Reserve rate cuts.
Nvidia shares jumped 9.32%, closing above the $1,000 per share mark for the first time. This helped boost the Nasdaq and S&P 500 to intraday records in early trading. However, stocks lost ground after economic data showed U.S. price pressures increased in May.
"It maybe speaks to the fact that people are now positioned for disappointing growth data, slower inflation data, rate cuts, and this morning... it caught people wrong footed," said Brian Nick, Senior Investment Strategist at The Macro Institute in New York.
The Dow Jones Industrial Average fell 605.78 points, or 1.53%, to 39,065.26. The S&P 500 lost 39.17 points, or 0.74%, to 5,267.84. The Nasdaq Composite lost 65.51 points, or 0.39%, to 16,736.03.
The gains in Nvidia helped lift the S&P 500 tech index 0.56%, the sole advancer among the 11 major S&P sectors on Thursday. However, chip stocks on the whole were lower, with the PHLX semiconductor index edging down 0.02% on the session.
The Dow was dragged lower in part by a 7.55% tumble in Boeing after the U.S. plane maker forecast negative free cash flow in 2024 due to sluggish deliveries. This accounted for over 90 points to the downside for the blue-chip index.
Declining issues outnumbered advancers for a 5.13-to-1 ratio on the NYSE and for a 3.59-to-1 ratio on the Nasdaq.