Nvidia surges; US stocks slump on higher rates
Nvidia went up a lot on Thursday – but not much else did.
The chipmaker powering the AI boom soared 9.3% after releasing stellar quarterly results yesterday after the close.
However, the S&P 500 fell 0.7% in its worst loss this month as higher interest rates weighed on stocks. US Treasury yields jumped after preliminary reports on the manufacturing and services sectors for the month of May came in well above expectations.
Better than expected data suggests US companies will continue to grow profits, but limits the scope – and need – for rate cuts from the Federal Reserve. A 25 basis point interest rate reduction is not fully priced in futures markets until December.
8 of 11 sector ETFs finished more than 1% lower, the most since April 12, and more than 8 members of the S&P 500 were down for every one that was up.
Interest rate sensitive sectors such as utilities and real estate were the worst-performing sector ETFs on the day.
Live Nation was the worst-performing S&P 500 constituent, falling 7.8% after the Department of Justice sued over antitrust concerns.
