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Stocks were mixed in afternoon action Thursday, as the S&P 500 and Dow Jones Industrial Average flirted with key levels ahead of Friday’s monthly jobs report. Nvidia (NVDA), however, broke a two-day selling spree and reversed higher as AI chip rival Broadcom (AVGO) prepared to report earnings. And Tesla (TSLA) surged on the stock market today as it announced plans for self-driving cars.
<span class="shortcode-video" data-nosnippet="true" vid-id="8849680" vid-dom-id="8849680-66da03ff0ccfa" vid-top vid-repeat="1" vid-width="100" vid-url="https://content.jwplatform.com/manifests/vUZ3ScDt.m3u8" jw-video-key="vUZ3ScDt" data-captions="[{"name":"English","url":"https://cdn.jwplayer.com/tracks/k20VfBTw.vtt"}]" data-permalink="https://www.investors.com/ibd-videos/videos/artificial-intelligence-interest-rate-cuts-how-investors-can-win-big-in-2024" data-description="On this episode of Industry Insights, we’re counting down to 2024 with new investment themes and strategies. Blackrock U.S.’ Jay Jacobs discusses the role big tech incorporating artificial intelligence will play in the markets. We also break down how potential interest rate cuts will influence investors.” vid-name=”From Artificial Intelligence To Interest Rate Cuts, Here’s How Investors Can Win Big In 2024″ vid-cat=”Industry Insights” vid-date=”12/22/2023″ vid-date-tmsp=”1703245977″ vid-image=”https://www.investors.com/wp-content/uploads/2023/12/outlook-640×360.jpg” vid-authors=”MEREDITH HEYMAN”>
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From Artificial Intelligence To Interest Rate Cuts, Here’s How Investors Can Win Big In 2024
The S&P 500 shed early gains and dipped 0.2%, hanging around its 50-day moving average ahead of Friday’s job report. A decisive move below that threshold by the benchmark index is considered an important short-term signal for the market.
The Dow, meanwhile, fell 0.5% Thursday afternoon. Though blue chips touched their 21-day exponential moving average, the index remains well above its 50-day line.
But stocks on the Nasdaq composite managed a 0.3% gain. The tech-dominated index is trying to recover from a steep sell-off on Tuesday and further losses Wednesday.
Volume was higher on the New York Stock Exchange and lower on the Nasdaq compared with the same time Wednesday. Advancers lagged decliners on the Nasdaq, but were slightly ahead on the NYSE.
The small-cap Russell 2000 fell 0.2% while the Innovator IBD 50 (FFTY) exchange traded fund sank 0.6% on the stock market today.
Among the S&P 500 sectors, technology, communication services and consumer discretionary gained while others lagged.
Napco Security Tech (NSSC) triggered a sell signal with a double-digit plunge well below its 200-day moving average in heavy volume. Its chart shows weakening action since its fourth-quarter report on Aug. 26.
2:03 p.m. ET
Nvidia Starts To Push Back
Magnificent Seven stock Nvidia moved higher, erasing some of Wednesday’s losses and a sharp sell-off on Tuesday. But the stock remains below the 50-day line.
Nvidia apparently got a lift from Broadcom’s pending earnings report. Investors await cues regarding artificial intelligence chip demand when Broadcom reports after the close.
Tesla (TSLA) held the bulk of its early winnings and was up 5% in recent action. The electric-vehicle maker plans to roll out its full self-driving in China and Europe in the first quarter of 2025. According to a post on X, the plans await regulatory approval. Shares are back above the 50-day moving average, according to IBD MarketSurge.
Tesla rival Nio (NIO) soared more than 13% after second-quarter results showed that losses narrowed, thanks to strong sales and higher margins.
Elsewhere, earnings moved Credo Tech Group (CRDO). Shares fell amid a four-day losing spree and are below the 50-day moving average on Thursday. First quarter sales and earnings decelerated.
Smartsheet (SMAR) reversed higher in the afternoon on the stock market today. The enterprise software company reports its second quarter results at market close.
12:12 p.m. ET
Job Data Mixed Ahead Of Payrolls Report
Employment data from Automatic Data Processing showed a softening in the job market with an increase of 99,000 jobs in August after a 122,000 increase in July. Economists had expected a 140,000 increase, according to Econoday.
But initial jobless claims for the week ended Aug. 31 came in lower than estimates for 227,000. Economists had expected 230,000. For the previous week, claims were revised to 232,000 from 231,000.
Friday’s employment data for August is another important economic report, with estimates of 160,000 additions in nonfarm payrolls.
Leading indicators from the Purchasing Managers Composite Index showed a 54.6 reading for services in August. Economists’ consensus were lower at 54.1. The Services Index rose to 55.7 against estimates of 55.2.
The Institute of Supply Management services index also came in above views for August, at 51.5 vs. views of 51.1 and was little changed from July’s 51.4.
10:45 a.m. ET
Stock Market Today: Fed Rate Cut Debate
With 13 days to go for the Fed meeting, investors are debating on the pivot that will start an easing cycle for the Fed rate. The CME FedWatch Tool is projecting a 55% chance of a 25-basis point rate cut. Odds of a 50-basis point cut stand at 45%.
The yield on the benchmark 10-year Treasury note fell two basis points to 3.75%.
Dow Jones Stocks
Verizon Communications (VZ) fell 0.5% on the stock market today and added to Wednesday’s losses after news that the company will acquire Frontier Communications (FYBR) for $20 billion in cash including debt.
Apple (AAPL) rose nearly 1% ahead of its product event on Monday. Shares are climbing back above the 50-day moving average as the stock forms a base with a buy point at 237.23. A handle appears to be forming, though.
Merck (MRK) led with a gain of 3%. Amazon.com (AMZN) also led Dow stocks.
Stock Market Today: Copart’s Sell Signal
Copart (CPRT) flashed a sell signal by falling below the 50-day and 200-day moving averages in heavy volume. The auto auction company’s July-quarter earnings declined while sales growth decelerated.
AeroVironment (AVAV) fell 5% in volatile trading on the stock market today after July-quarter results beat views while its earnings outlook missed expectations. The drone maker reported its results late Wednesday.
Among AI plays, C3.ai (AI) plunged 10% in the stock market today even after beating views. Shares continue to trade below the 50-day moving average amid a downtrend.
Shares of Applied Digital (APLD) soared over 60% after news that Nvidia and other companies are participating in a $160 million funding to build its data centers.
Please follow VRamakrishnan on X/Twitter for more news on the stock market today.
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