Stock market today: Nasdaq heads for tough run into September as Nvidia sales continue
Economy

Stock market today: Nasdaq heads for tough run into September as Nvidia sales continue

US stocks tumbled on Tuesday to kick off a historically tough month for markets, as AI darling Nvidia (NVDA) and chip stocks dropped tech prices. Meanwhile, attention is focused on a week of data on the economy and the labor market highlighted by the important monthly jobs report.

The Dow Jones Industrial Average (^DJI) fell 1%, or more than 400 points. The S&P 500 (^GSPC) fell 1.4%, while the tech-heavy Nasdaq Composite (^IXIC) returned 2.4%.

Stocks are falling near record highs as Wall Street hunts after August, in anticipation of a tumultuous September. Investors are weighing the risk of data shocks or surprises in the presidential race in what is usually a bad month for traders.

Early trading on Tuesday did not bode well. Nvidia ( NVDA ) fell more than 7% Tuesday, as investors continued to pull back after a lackluster earnings report and lingering questions about the future of the AI ​​business. Other chip stocks fell similarly, with Broadcom (AVGO), Qualcomm (QCOM), and Taiwan Semiconductor Manufacturing Company (TSM) all down more than 5%.

Also top of mind is the August jobs report, due out on Friday, which could profoundly influence how the Federal Reserve cuts interest rates at its meeting this month. Now that inflation is cooling, policymakers are on the lookout for labor market contraction.

For investors, the focus is on whether signs of a slowdown in the July jobs report were exaggerated – or an early warning of a bigger slowdown. Any suggestions of stress should put pressure on the Fed to make a bigger reduction in rates. As of Tuesday, traders were buying rates at a 31% cut of 50 basis points instead of 25 basis points, according to the CME FedWatch Tool.

U.S. manufacturing rose last month, according to new figures from the Institute for Supply Management (ISM). But the metric showed slowing factory performance, with the number below the threshold that suggests a slowdown in the manufacturing sector.

Live5 updates

  • Stocks start in September

    US stocks tumbled on Tuesday to kick off a historically tough month for markets, as AI darling Nvidia (NVDA) and chip stocks dropped tech prices.

    The Dow Jones Industrial Average (^DJI) fell 1%, or more than 450 points. The S&P 500 (^GSPC) fell 1.5%, while the tech-heavy Nasdaq Composite (^IXIC) pulled back as much as some 2.5%.

  • Construction costs are falling more than expected

    While the August jobs report on Friday is the headline economic news this week, Tuesday provided a glimpse of construction activity, which has implications for the housing market.

    The Commerce Department reported Tuesday that construction spending fell 0.3% in July, compared with no change the previous month. Inflation and spending figures fell by 0.1%

    The drop in spending was slightly larger than expected reflecting higher mortgage rates and greater supply.

    Weak demand has eased builders into new construction projects. Single-family home construction fell to a 16-month low in July.

    However, interest rates continued to decline in August as expectations of a rate cut from the Federal Reserve increased during the upcoming September policy meeting. Rates are expected to drop further as potential home buyers wait for better rates.

    Pricing is still an issue, although borrowing costs may be falling.

    Fannie Mae’s Home Purchase Sentiment Index, which measures consumer sentiment about the housing market, fell in July. That highlights how the lack of affordability is weakening housing activity.

  • Why are we not ready for the first presidential election in the AI ​​era?

    With the election just a few months away and the latest AI detection technologies already in place, experts say we can expect to see more AI-based content designed to spread poverty. consensus among voters, reports Dan Howley of Yahoo Finance.

    The 2024 election is America’s first presidential election of the AI ​​era, and we’re already seeing examples of the technology being used to influence the way Americans vote.

    On Aug. 18, former President Donald Trump shared a series of AI-generated images of Taylor Swift fans wearing pro-Trump shirts, despite the fact that the photos originally appeared in a post marked as satire on X ( formerly Twitter). In January, serious phone calls went out to some New Hampshire residents, trying to discourage them from participating in the state’s democracy.

    “The danger is that if there is some kind of AI disinformation … like Taylor Swift’s pictures … about the election,” explained Augusta University political science professor Lance Hunter.

    “[In] swing state, sometimes the margin of victory is less than 1%. So … a small number of people who are exposed to this disinformation and don’t realize it’s disinformation can have an impact on the outcome of the election,” Hunter added.

    Read more here.

  • Stocks moving forward in morning trading

    Here are some of the stocks leading the Yahoo Finance tickers page during morning trading on Tuesday:

    Boeing (BA): The plane maker’s shares fell 6% Tuesday morning after the price target was cut from Wells Fargo, which highlighted the company’s cash flow pressure as it works to produce new planes. The company also faces a possible major strike, as its workers in Washington state plan to strike if a deal is not reached later this month.

    US Steel (X): The steel producer fell nearly 4% after Democratic candidate Kamala Harris said the company should remain American and deal with a proposed takeover by Japan’s Nippon Steel. Republican candidate Donald Trump has also rejected the proposed sale.

    Nvidia (NVDA): Shares of the AI ​​chip maker fell 5% in early morning trading on Tuesday, continuing a rapid slide after the company’s earnings report last week failed to impress Wall Street. The stock has fallen more than 10% in the past five days, highlighting a difficult period for AI and chip companies that have been stalled, as questions about the return on investment from their customers mount.

    Unity (U): The video game software maker gained more than 7% Tuesday after analysts at Morgan Stanley upgraded its shares to Overweight from Equal Weight, reflecting the strength of its game engine business and Unity holds its market share.

  • Stocks slide in morning trading

    US stocks fell on Tuesday to begin September, a difficult month in market history as attention turned to a week of labor data highlighted by the key monthly jobs report.

    The Dow Jones Industrial Average (^DJI) is down about 0.5% after a victorious session set before the Labor Day break. The S&P 500 (^GSPC) fell 0.6% while the tech-heavy Nasdaq Composite (^IXIC) retreated 0.8%.

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