Market News
Wall Street closed lower on Tuesday, driven by declines in technology stocks as investors awaited Friday's job data, which could influence economic outlook and market sentiment. The Dow, the S&P 500 and the Nasdaq all ended the day in negative territory.
How Did The Benchmarks Perform?
The Dow Jones Industrial Average (DJI) fell 1.5% or 626.15 points to close at 40,936.93. Notably, 24 components of the 30-stock index ended in negative territory, while six finished in positive zone.
The S&P 500 tumbled 119.47 points, or 2.1%, to close at 5,528.93. Out of the 11 broad sectors of the benchmark, nine ended in negative territory, while two ended in the green zone. The Technology Select Sector SPDR (XLK), the Materials Services Select Sector SPDR (XLB), and the Energy Select Sector SPDR (XLE) fell 4.6%, 2.3% and 2.5%, respectively.
The tech-heavy Nasdaq Composite declined 577.33 points, or 3.3%, to close at 17,136.30.
The fear-gauge CBOE Volatility Index (VIX) was up 33.25% to 20.72. A total of 12.14 billion shares were traded on Tuesday, higher than the last 20-session average of 11 billion. Advancers outnumbered decliners by a 2.52-to-1 ratio on the NYSE. On the Nasdaq, advancing issues led decliners by a 3.5-to-1 ratio.
NVIDIA Stock Faced Sharp Decline
On Tuesday, shares of NVIDIA Corporation NVDA fell by 9.5%, erasing $279 billion in market value in a single day. This record-setting drop for a U.S. stock highlights wider worries within the semiconductor sector. The decrease follows recent legal inquiries by the U.S. Justice Department into potential antitrust breaches by NVIDIA.
The substantial decline in the company value also played a role, in dragging down technology stocks and semiconductor exchange-traded funds (ETF). Amid the ongoing market volatility, NVIDIA’s sharp drop highlights the sensitivity of tech stocks to regulatory scrutiny and economic shifts.
Consequently, NVIDIA carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Weak Manufacturing Data, Jobs Report in Focus
On Tuesday, the Institute of Supply Management (ISM) reported that the manufacturing index came in at 47.2% in August, less than the consensus estimates of 47.6% and marking a decline in activity for three consecutive months. Notably, any reading below 50 indicates a contraction in manufacturing activities.
The weaker manufacturing data has heightened concerns about a potential economic slowdown in the United States. As a result, attention is turning to the upcoming payrolls report scheduled for Friday. A strong jobs report could provide reassurance and support the narrative of a soft landing for the economy, whereas a disappointing figure could reinforce fears of a more significant economic cooling. The payrolls report will be closely watched for indications of labor market strength and its potential impact on the economic outlook and market sentiment.
Construction Outlays Declines
Construction spending declined 0.3% in July, in contrast to the consensus estimate of a decrease of 0.1%. following no change in June.
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NVIDIA Corporation (NVDA) : Free Stock Analysis Report
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