Stock Market News Today: Markets mixed as Nvidia surge countered by data (SP500)

U.S. stocks on Thursday were mixed, as a massive post-earnings surge in chip giant Nvidia (NVDA) was countered by economic data that dented Federal Reserve interest rate cut expectations.

The tech-heavy Nasdaq Composite (COMP:IND) gained 0.86% to 16,945.32 points in mid-day trade, primarily on the back of Nvidia (NVDA). The chipmaker’s stock added more than $250B to its market cap following another blowout quarterly earnings report.

The benchmark S&P 500 (SP500) added 0.29% to 5,322.63 points. The Dow (DJI) lagged the other two major averages, slipping 0.68% to 39,400.48 points. Boeing (BA) was a significant drag on the blue-chip gauge, after the planemaker’s finance chief issued some negative comments around deliveries and cash flow at an investor conference.

The Nvidia (NVDA) bump was enough to help both the Nasdaq (COMP:IND) and S&P (SP500) take out fresh intraday all-time peaks. In fact, the former at its session high came within a whisker of crossing 17,000 points for the first time ever.

“Today, the market reaches the 100-day mark of the year. And what a year it’s been for the most benchmarked equity index in the world, as the S&P 500 (SP500) has set (at least) 23 record high closes during these 100 days,” SentimenTrader said on X (formerly Twitter).

“This year qualifies as one of the best since 1928 in terms of persistent record highs. Only a handful of other years have matched or exceeded this performance, including only one over the past 25 years. A strong first 100 days tends to precede further gains into year-end,” SentimenTrader added.

Looking at Thursday’s sector action, 10 of the 11 S&P names were in the red.

Technology was the only gainer, mainly due to Nvidia (NVDA). The Jensen Huang-led firm’s fiscal first quarter results showed revenue from data centers swelling by a staggering 427% Y/Y, underscoring the seemingly inexhaustible demand for the company’s chips that power artificial intelligence (AI) processes.

Even with expectations sky high going into the report, Wall Street was still left shocked by the results, leaving many analysts scrambling to reassess just how big the AI market can become. As of 1241 ET, Nvidia (NVDA) is trading at 1,052.90/share, marking an increase of $254.78B in market cap from its last close. The chipmaker is now bigger than the combined market cap of retail and tech behemoth Amazon (AMZN) and electric vehicle maker Tesla (TSLA).

Countering the Nvidia (NVDA) and AI euphoria on Thursday was a key economic indicator on manufacturing and inflation. Shortly after the opening bell, data from S&P Global showed that U.S. business activity in May grew at its fastest rate since April 2022. Meanwhile, input prices continued to rise sharply in May, with the rate of inflation accelerating to register the second-largest monthly increase over the past eight months.

This combination of sticky inflation and strong growth despite high interest rates is something that the Fed doesn’t want to see. The data also comes a day after the minutes of the central bank’s April/May monetary policy committee meeting showed “various participants” willing to increase rates should that be necessary.

Other items on the economic calendar included the Chicago Fed’s monthly gauge of overall economic activity and related inflationary pressure coming in slightly lower in April, and the number of Americans filing for initial jobless claims falling for a second week in a row. Additionally, new home sales unexpectedly fell in April.

U.S. Treasury yields were higher on Thursday as bonds sold-off. The longer-end 30-year yield (US30Y) was up 5 basis points to 4.59%, while the 10-year yield (US10Y) was up 6 basis points to 4.49%. The shorter-end more rate-sensitive 2-year yield (US2Y) was up 7 basis points to 4.95%.

See live data on how Treasury yields are doing across the curve at the Seeking Alpha bond page.