Indexes end sharply higher; AI chip maker Nvidia jumps again after the
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[August 24, 2023] By
Caroline Valetkevitch
NEW YORK (Reuters) - U.S. stocks ended sharply higher on Wednesday as
shares of Nvidia gained ahead of quarterly results from the company
whose chips are widely used for artificial intelligence (AI) computing.
Shares of Nvidia, which reported results after the closing bell, jumped
9%, extending a gain of 3.2% during the regular session.
It forecast third-quarter revenue above Wall Street targets. Other tech
companies jumped in after-hours trading as well including Microsoft,
which was last up about 2%.
Bullish investors have been hopeful that upbeat news from Nvidia could
could further ear's strong rally in tech stocks. Including the session
move, Nvidia's stock is up more than 220% for the year so far.
"Not just their numbers, but what they say in the conference call about
what's happening in AI is going to have a big impact on market
sentiment," said Rick Meckler, partner, Cherry Lane Investments, a
family investment office in New Vernon, New Jersey.
Nvidia is part of the so-called Magnificent Seven group of megacap
stocks including Apple and Tesla that have powered the S&P 500's sharp
gains this year.
During the trading session, stock investors were encouraged as the yield
on the 10-year U.S. Treasury note eased from near 16-year highs after
weak business activity data from the United States and the euro zone.
U.S. Federal Reserve Chair Jerome Powell's comments on Friday at the
Jackson Hole conference will be scrutinized for clues on the U.S.
central bank's interest rate path.
The Dow Jones Industrial Average rose 184.15 points, or 0.54%, to
34,472.98, the S&P 500 gained 48.46 points, or 1.10%, to 4,436.01 and
the Nasdaq Composite added 215.16 points, or 1.59%, to 13,721.03.
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Traders work on the floor of the New
York Stock Exchange (NYSE) in New York City, U.S., August 15, 2023.
REUTERS/Brendan McDermid/File Photo
Data showed U.S. business activity approached the stagnation point
in August, with growth at its weakest since February, as demand for
new business in the vast service sector contracted, while the
downturn in euro zone activity was far deeper than expected.
Before the PMI data, yields on the 10-year note had been rising this
month as investors were thinking the Fed could keep rates higher for
longer.
According to strategists in a Reuters poll, the S&P 500 will eke out
only marginal gains between now and year end, after its strong move
up already this year. The index was forecast to end the year at
4,496.
Shares of drugmaker Gilead Sciences rose 0.9% and Merck & Co
advanced 3.8% after Swiss rival Roche inadvertently published
positive lung cancer drug trial data.
Advancing issues outnumbered declining ones on the NYSE by a
3.74-to-1 ratio; on Nasdaq, a 2.07-to-1 ratio favored advancers.
The S&P 500 posted 8 new 52-week highs and 10 new lows; the Nasdaq
Composite recorded 46 new highs and 156 new lows.
(Reporting by Caroline Valetkevitch; additonal reporting by Amruta
Khandekar and Shristi Achar A; Editing by Shinjini Ganguli, Anil
D'Silva and David Gregorio)
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