US stocks stumble as AI trade takes a hit
Friday’s drop pushed the S&P 500 marginally into negative territory for the week.
US stocks slumped into the long weekend, with the S&P 500 ending August with its biggest daily decline since the first trading day of the month.
Even so, the drop of 0.6% barely pulled the benchmark US stock index into the red for the week. The Nasdaq 100 fared worse on Friday, falling 1.2%, while the Russell 2000 gave back 0.5%.
Tech and consumer discretionary were the worst-performing S&P 500 sector ETFs, while the beaten-up defensive pockets of the market like healthcare and consumer staples caught a bid to end the week.
Autodesk was one of the session’s bright spots, up 9.1% after the maker of design software posted a beat-and-raise earnings report after Thursday’s close. Meanwhile, Dell led declines, falling 8.9% after the tech hardware company topped Q2 estimates but issued soft guidance for Q3. Elsewhere...
Marvell Technology fell 18.6% after posting lower-than-expected data center results and a weak Q3 forecast. Meanwhile, hyperscaler Oracle also fell 5.9% amid a broader pullback for the AI trade, fueled in part by Marvell’s weak outlook.
Nvidia shares fell 3.3% following a Wall Street Journal report that Alibaba was developing an AI chip to be manufactured in China.
Super Micro Computer fell 5.5% after the AI server maker warned it still hasn’t fully fixed the accounting issues that nearly got it delisted from the Nasdaq back in February.
Alibaba rose 12.9% after the Chinese e-commerce giant missed Q1 earnings and revenue expectations but beat estimates for its all-important cloud and AI segment.
Petco shares surged 23.5% as traders applauded the pet store chain’s strong second-quarter results and improved full-year EBITDA guidance, which were released after the bell on Thursday.
Affirm shares leapt 10.6% after the buy now, pay later giant posted a Q4 earnings beat and issued a stronger-than-expected forecast for its key gross merchandise volume (GMV) metric.
Celsius shares jumped 5.3%, hitting a 52-week high, after Pepsi hiked its stake in the energy drink maker to 11% in a $585 million deal. Pepsi shares rose 1.1% on the news.
Opendoor shares climbed 4.2% after CEO Shrisha Radhakrishna purchased 30,000 shares of company stock.
Ulta Beauty shares were up as much as 3.7% in early trading before closing down 7.1%, even as the beauty juggernaut posted a strong Q2 and raised its full-year outlook.
Lucid shares slid 4.4%, hitting a record low, after Stifel slashed its price target by 30% to $2.10 from $3. The luxury EV maker is also bracing for a 1-for-10 reverse stock split next week.
Duolingo shares dropped 7.7% as the language-learning company (and retail favorite) slipped into a sudden reversal in the momentum trade that has dominated the market bounce since mid-April.
