Stocks sink as strong Nvidia earnings fail to ease Wall Street’s AI anxiety
The S&P 500, Nasdaq 100, and Russell 2000 all fell, with tech leading the sell-off.
Stocks wiped out early gains from post-Nvidia earnings euphoria, as the chip designer’s blowout earnings weren’t enough to ease investors’ concerns of bloated valuations and an AI bubble. The SPDR S&P 500 ETF opened over 1.5% up and closed over 1.5% lower, a feat seen only three other times since the fund’s inception.
All major US indexes dropped as the tech sector led the sell-off. Every company in the Magnificent 7 fell, despite Alphabet notching a new intraday high in early trading.
Odds of a December Fed rate cut crept higher after the September jobs report presented a mixed bag: much better job growth than anticipated, but the unemployment rate unexpectedly edged higher.
Stocks that moved higher:
Walmart spiked after reporting earnings and sales results that beat Wall Street estimates, showing American consumers are flocking to the company’s stores.
Stocks that moved lower:
Despite blowout earnings and CEO Jensen Huang and CFO Colette Kress dismantling most of the recent arguments and bear cases put forward by their naysayers in yesterday’s earnings call, Nvidia dipped.
Shares of US auto giant Ford ticked down following reports of another major fire at its primary aluminum supplier’s plant in Oswego County, New York.
Tesla initially spiked amid AI bullishness as Piper Sandler analyst Alexander Potter said Full Self-Driving software is “already better at driving than the average American” before closing lower along with the rest of the Mag 7.
