American investors reap profits from tech shares
Mellow vibe on Wall Street: Recent economic data leaves investors puzzled. Following the recent peak at Nvidia, traders opt to cash out, with losses also observed in other Tech stocks. The Dow, however, could potentially surge significantly.
Investors have put the brakes on the record run fueled by the AI hype. The Nasdaq composite closed 0.8% lower on Thursday at 17,721 points. The broad-based S&P 500 lost 0.3% to 5473 levels. Contrastingly, the Dow Jones Industrial Average gained 0.8% to 39,134 points.
Investors dumped Nvidia shares during the trading session: The stocks shifted to negative and fell 3.5%. The company had exceeded Microsoft on Tuesday to become the world's most valuable company by market capitalization with a market value of $3.34 trillion. The US markets were closed on Wednesday due to a holiday.
The interest rates and the potential timing of a cut by the US Federal Reserve (Fed) continued to sway investors. Few hints emerged from economic data. The number of Americans filing new unemployment claims dropped on a weekly basis, but the overall robustness of the labor market remains. Another dataset showed that new home construction in the US decreased in May due to persistently high mortgage rates. "I believe the Fed needs to see more decisive or reinforcing data that suggests the economy might be decelerating. I don't think we're witnessing that yet," said Joseph Ferrara, investment strategist at Gateway Investment Advisors.
The Bank of England (BoE) stuck to its rigorous monetary policy despite the recent easing of inflation pressures. Conversely, the Swiss National Bank (SNB) eased after the March rate hike and decreased its policy rate for the second time in a row.
Accenture pleased investors with a positive business forecast. The IT services company's shares skyrocketed by more than 7%. The company is projected to boost its revenue by 1.5-2.5% in the fiscal year 2024. Analysts had anticipated an average increase of 1.6%. Favorable clinical trial data propelled shares of Gilead Sciences by 8.5%. Data indicated that its long-acting injectable medication was more effective in preventing HIV infections in women compared to its existing daily pill Truvada.
Shares of electric truck manufacturer Nikola plummeted 31% into the red. The company revealed plans for a reverse stock split. Under this plan, the number of shares in circulation will be substantially reduced to boost the stock price.
For a detailed analysis of today's stock market developments, please see here.
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Despite the recent losses in Tech stocks like Nvidia, some analysts remain optimistic about the Dow's potential growth. Amidst the selling pressure, share prices of certain tech companies, such as Nvidia, experienced a downturn on Wall Street, leading to share trading activities.
