Dow and Nasdaq fall as tech sector stumbles; investors focus on Nvidia’s chip delivery schedule
On Wednesday, stocks retreated as Nvidia’s decline weighed on the market, with investors awaiting the chipmaker’s latest earnings report, according to CNBC.
The Nasdaq Composite fell 1.12 percent to close at 17,556.03, the S&P 500 dipped 0.6 percent to finish at 5,592.18, and the Dow Jones Industrial Average dropped 159.08 points, or 0.39 percent, settling at 41,091.42.
Investors are closely monitoring Nvidia’s performance to gauge the sustainability of the ongoing tech and artificial intelligence (AI) rally. Nvidia’s stock has soared more than 150 percent in 2024, raising questions about how much further it can go.
On Wednesday, the stock declined by 2.1 percent, contributing to a 1.3 percent drop in the information technology sector.
Key areas of focus for investors include Nvidia’s delivery schedule for its new Blackwell chips and the ongoing demand for AI-related products. Art Hogan, chief market strategist at B. Riley Wealth Management, expressed optimism about Nvidia’s potential to exceed expectations again.
Hogan noted that Nvidia’s major customers have already reported their spending on the company’s chips. “All of the hyperscalers have discussed significant capital expenditures on the graphics processing units (GPUs) they require to advance their AI strategies,” he explained.
He added, “Nvidia has consistently outperformed expectations, and its largest customers continue to demand as many products as they can supply.”
The decline was not limited to Nvidia. Other technology giants, including members of the ‘Magnificent Seven,’ also saw their stocks drop.
Amazon and Alphabet both fell by over 1 percent, while Microsoft slipped 0.8 percent. Meanwhile, Super Micro Computer, another company in the AI sector, plunged 19 percent after announcing a delay in filing its annual report for the fiscal year.
