The US stock market closed in the red today after a brief morning rally failed to sustain its momentum. Major indices such as the S&P 500, Dow Jones Industrial Average, Nasdaq composite, and Russell 2000 index all ended the day lower, reflecting the overall negative sentiment in the market.
Stocks swung lower as Nvidia, one of Wall Street’s most influential companies, went from a morning gain of 4.4 per cent to a loss of 5.1 per cent, making it the heaviest weight on the S&P 500. The struggles of Nvidia and other Big Tech stocks in recent weeks have raised concerns about overvaluation in the sector, particularly in the artificial-intelligence technology space.
Super Micro Computer, a company that sells server and storage systems used in AI and other computing, reported a 143 per cent increase in revenue but fell short of analysts‘ expectations for profit. As a result, its stock tumbled 20.1 per cent, further dampening enthusiasm around AI technology.
The Walt Disney Co. delivered stronger-than-expected earnings for the latest quarter, with its streaming business reporting a profit for the first time. However, the stock still fell 4.5 per cent as the company warned of softness at its U.S. theme parks that could persist for the next few quarters.
Airbnb also saw a significant drop in its stock price, tumbling 13.4 per cent after its second-quarter profit fell short of analysts‘ expectations. The company noted signs of slowing demand in the U.S., adding to the negative sentiment in the market.
Despite the overall decline, Apple was a bright spot, with its stock rising 1.2 per cent and helping to limit the market’s losses.
The US market today followed a trend seen in other global exchanges, with European and Asian bourses initially rallying before turning lower. The Bank of Japan’s dovish signal on interest rates provided some support, but a poorly received US Treasury bond auction triggered further selling in the afternoon.
In conclusion, the US stock market closed in the red today, reflecting ongoing concerns about overvaluation in the tech sector and broader market volatility. While some companies delivered strong earnings, others fell short of expectations, contributing to the overall negative sentiment in the market. Investors will be closely watching for any developments that could impact market dynamics in the coming days.