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Stock Market Today: Nasdaq closes above 17,000 for first time as Nvidia shines

Published 05/27/2024, 07:46 PM
Updated 05/28/2024, 04:08 PM
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Investing.com -- The Nasdaq closed above 17,000 for the first time ever Tuesday, underpinned by a surge in Nvidia amid ongoing AI-led optimism.   

At 16:00 ET (20:00 GMT),NASDAQ Composite rose 0.6% to close at a record of 17,019.88, the Dow Jones Industrial Average fell 216 points, or 0.6%, while S&P 500 rose 0.1%.

Tech continues to lead as Nvidia shines, Apple rally fades

Nvidia (NASDAQ:NVDA) stock rose 7%, with the tech giant’s market value surpassing $2.5 trillion since its quarterly results, solidifying its position as the third most valuable company on Wall Street.

Nvidia's latest following quarterly results and guidance last week that surprised on the upside and underscored the ongoing AI-led demand for chips. 

"We think the AI investment cycle remains early (as long as AI apps demonstrate ROI) with a new inference infrastructure buildout similar to the scale of all datacenters globally once uptake is ubiquitous," Macquarie said in Tuesday note. 

Demand for AI was given further credence over the weekend after Elon Musk's xAI said it had raised $6 billion to fund AI development.  

Apple (NASDAQ:AAPL) stock gave up gains to close flat even as the iPhone maker’s smartphone shipments in China were 52% higher in April than a year ago, according to data from a research firm affiliated with the Chinese government.

U.S. Cellular soars on sale of wireless business to T-Mobile; Draft Kings, Flutter slump; Gamestop

United States Cellular Corporation (NYSE:USM) rose 12% after the company said it had agreed to sell its wireless operations and 30% of spectrum assets to T-Mobile for $4.4B. The 

Sport-betting companies including DraftKings (NASDAQ:DKNG) and Flutter Entertainment (NYSE:FLUT) were nursing heavy losses after after the Illinois Senate passed a bill that includes a sports-betting tax hike.

GameStop Corp (NYSE:GME) jumped 25% after the market said Friday that it raised $933 million from its previously announced 45 million share offering, boosting its finances.  

Treasury yields rise as consumer confidence unexpectedly jumps; PCE eyed

Treasury yields were higher as expectations that there is still a ways to go until the Fed begins cutting rates were strengthen following data pointing to a stronger consumer. 

Consumer confidence unexpectedly rose in May, the Conference Board survey released Tuesday, pointing to strength in the consumer, which drives the bulk of U.S. economic growth.

 

Traders continue to price out expectations for a rate cut in September. The CME Fedwatch tool shows traders pricing in a 50.7% probability the central bank will keep rates steady, along with a 43.6% chance of a 25 basis point rate cut.

The data came ahead of the release of PCE price index data on Friday, widely seen as the inflation release that the Federal Reserve concentrates on. 

Friday’s PCE reading is expected to show some cooling in inflation. But inflation is also set to remain well above the Fed’s 2% annual target range. 

The economic calendar also features revised data on first quarter economic growth on Thursday and the Fed’s Beige Book on Wednesday, while investors will also get the chance to hear from several Fed speakers during the week including Governor Michelle Bowman, Cleveland Fed President Loretta Mester, Governor Lisa Cook, New York Fed President John Williams and Atlanta Fed President Raphael Bostic.

(Peter Nurse, Ambar Warrick contributed to this article.)

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