Stocks tumble, Nasdaq closes 2% lower after stunning reversal in AI, Nvidia stocks
Stocks fell on Thursday, as a market-wide rally sparked by blockbuster Nvidia results and guidance gave up steam and as investors lost hope that the Federal Reserve would cut rates again in December.
The Dow Jones Industrial Average last traded 274 points, or 0.6%, lower, after rallying more than 700 points at session highs. The S&P 500 shed 1.2% despite rising 1.9% earlier in the day. The Nasdaq Composite fell 1.8%, down from a 2.6% advance at one point in the session.
Nvidia’s reversal lower dragged the broader market down. Shares had gained 5% after the chipmaker released better-than-expected quarterly results and an upbeat fourth-quarter sales forecast. CEO Jensen Huang said demand for its current-generation Blackwell chips are “off the charts” and rejected the idea of an AI bubble.
But the stellar results were not enough to keep the stock or the market higher with concerns swirling about AI stock valuations, especially if the Fed doesn’t lower interest rates. Oracle and AMD were among the first AI plays to fall into the red on the session, followed by Nvidia, which was last down more than 1%.
Adding to downward pressure was a shutdown-delayed September jobs report that showed the economy added 119,000 jobs, more than economists’ expected. Following the data, the latest fed funds futures trading showed less than 40% odds that the central bank would cut for a third time this year next month — a negative for investors betting on lower interest rates.
Source : Cnbc.com
