The S&P 500 and Nasdaq achieved fresh intraday record highs as investors celebrated Nvidia’s robust revenue forecast. However, concerns about U.S. inflation tempered the overall market enthusiasm.
Nvidia, a leader in AI chips, saw its shares soar by 10.5%, propelling the stock past the significant $1,000 milestone for the first time. This surge could potentially increase the company’s market value by approximately $220 billion. Chief economist Brian Jacobsen from Annex Wealth Management noted that while there was apprehension about Nvidia meeting elevated expectations, the company exceeded them. Nevertheless, Jacobsen expressed concerns about the sustainability of this positive trend.
Despite the initial market euphoria, sentiment dampened following reports of rising U.S. price pressures in May alongside accelerated business activity and robust labor market indicators. Traders are now speculating a 57.3% chance of at least a 25-basis-point rate cut by the Federal Reserve in September.
Technology stocks, led by information technology, recorded gains, with the S&P 500 and Nasdaq reaching all-time highs early in the trading session. However, data showing increased inflationary pressures and the possibility of economic growth acceleration led to a more cautious market sentiment.
The Dow Jones Industrial Average lagged behind other major indexes, dropping to an over one-week low primarily due to a 5.9% decline in Boeing shares. The aircraft manufacturer projected negative free cash flow in 2024 due to slower deliveries.
As of 11:36 a.m. ET, the Dow Jones Industrial Average was down by 287.52 points, the S&P 500 was up by 9.59 points, and the Nasdaq Composite climbed by 125.85 points. Apart from the technology sector, all other major S&P 500 sectors were in negative territory, showcasing a mixed market sentiment amid inflation and economic growth concerns.
