Nasdaq Reaches New Record Intraday High But Dow Extends Pullback

After moving sharply higher over the course of last Friday’s session, the Nasdaq is seeing further upside during trading on Tuesday. With the upward move, the tech-heavy index has reached another new record intraday high.

Meanwhile, the S&P 500 has spent the day bouncing back and forth across the unchanged line, while the Dow is extending the sharp pullback seen last week.

The Nasdaq is currently up 73.91 points or 0.4 percent at 16,994.70. The S&P 500 is up 0.65 points or less than a tenth of a percent at 5,305.37, but the Dow is down 157.24 points or 0.4 percent at 38,912.35.

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The continued advance by the Nasdaq comes amid a sharp increase by shares of Nvidia (NVDA), with the AI darling surging by 5.3 percent to a record intraday high.

Last week, Nvidia reported better than expected fiscal first quarter results and provided upbeat guidance while also announcing a ten-for-one stock split and increasing its quarterly cash dividend by 150 percent to $0.10 per share.

Overall trading activity remains somewhat subdued, however, as traders look ahead to the release of key inflation data later this week.

On Friday, the Commerce Department is due to release its report on personal income and spending in the month of April, which includes readings on inflation said to be preferred by the Federal Reserve.

The inflation data could have a significant impact on the outlook for interest rates ahead of the Fed’s next monetary policy meeting on June 11-12.

In an interview with CNBC this morning, Minneapolis Fed President Neel Kashkari said he needs to see “many more months of positive inflation data” before he would consider cutting interest rates.

Kashkari, who does not have a vote on the rate-setting Federal Open Market Committee this year, also said he could not rule out raising interest rates if inflation fails to slow.

On the U.S. economic front, the Conference Board released a report unexpectedly showing a significant improvement in consumer confidence in the month of May.

The Conference Board said its consumer confidence index jumped to 102.0 in May from an upwardly revised 97.5 in April.

The rebound surprised economists, who had expected the consumer confidence index to decrease to 95.3 from the 97.0 originally reported for the previous month.

Sector News

Computer hardware and semiconductor stocks are extending the strong upward moves seen last Friday, contributing to the advance by the tech-heavy Nasdaq.

Reflecting the strength in the sectors, the NYSE Arca Computer Hardware Index and the Philadelphia Semiconductor Index are climbing by 1.9 percent and 1.8 percent, respectively. Both indexes have reached new record intraday highs.

Significant strength is also visible among gold stocks, as reflected by the 1.8 percent gain being posted by the NYSE ARCA Gold Bugs Index.

The strength in the gold sector comes amid an increase by the price of the precious metal, with gold for June delivery jumping $20.10 to $2,354.60 an ounce.

Energy stocks are also seeing notable strength amid a sharp increase by the price of crude oil, while pharmaceutical and healthcare stocks have moved to the downside.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region moved modestly lower during trading on Tuesday. Japan’s Nikkei 225 Index edged down by 0.1 percent, while China’s Shanghai Composite Index fell by 0.5 percent.

The major European markets have also moved to the downside on the day. While the French CAC 40 Index has slumped 1.0 percent, the U.K.’s FTSE 100 Index is down by 0.9 percent and the German DAX Index is down by 0.6 percent.

In the bond market, treasuries are seeing modest weakness after ending last Friday’s trading roughly flat. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, is up by 1.4 basis points at 4.487 percent.

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