Nvidia Concerns Pressure Tech as Dow Jones DJIA Dips, NASDAQ Falls Sharply
Due to losses in big tech firms and new worries about Nvidia's margins, the NASDAQ led Tuesday's dip, while the Dow closed slightly lower.
Quick overview
- The Dow closed 91.99 points lower, while the NASDAQ led the decline due to losses in major tech stocks, particularly Nvidia.
- Despite a lack of significant news, Wall Street experienced active trading, influenced by concerns over Nvidia's profit margins.
- The Russell 2000 small-cap index suffered the steepest drop, reflecting worries about rising borrowing costs and slowing demand.
- AMD stood out with a 3.83% increase, driven by optimism over its new AI chip launch, contrasting with the overall market's cautious sentiment.
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Due to losses in big tech firms and new worries about Nvidia’s margins, the NASDAQ led Tuesday’s dip, while the Dow closed slightly lower.
A Lively Market in a Quiet News Cycle
Despite a lack of significant news or fresh economic data—largely due to the ongoing US government shutdown that has stalled key updates—Wall Street saw an active trading session. The spark came from The Information, which reported that Nvidia’s chip-rental business model is putting pressure on profit margins.
This revelation prompted a swift reversal in Nvidia’s stock and dragged down other major technology names. The broader market saw waves of profit-taking as investors booked gains, with even gold losing ground after recent rallies.
US Stock Market Wrap-Up: A Mixed Close for Key Indices
US equities ended Tuesday on a mixed note as investors weighed rising Treasury yields, cautious earnings guidance, and upcoming economic data. The session saw blue-chip and large-cap indices edge lower, while small caps faced heavier selling pressure.
Dow Jones Industrial Average
- Closed 91.99 points lower (-0.20%), finishing the day at 46,602.98.
- Losses in cyclical stocks and mild profit-taking weighed on the index after a recent rally.
S&P 500
- Declined 25.69 points (-0.30%) to settle at 6,714.59.
- Weakness in technology and consumer discretionary sectors contributed most to the decline.
Nasdaq Index
- Fell 0.67% (-153.30 points) to 22,788.36.
- Weakness in tech names weighed on the index,
Russell 2000 – Small-Caps Underperform
- The Russell 2000 suffered the steepest drop, falling 27.93 points (-1.12%) to close at 2,458.42.
- Traders cited higher borrowing costs and concerns about slowing demand for smaller companies as reasons for the sell-off.
Market Context
- Rising Treasury yields and cautious sentiment ahead of key economic reports pressured equities.
- Investors rotated out of growth-heavy small caps and tech names into safer sectors such as utilities and healthcare.
NASDAQ Leads the Declines
The technology-heavy NASDAQ Composite fell 0.67% (-153.30 points) to close at 22,788.36, as weakness in leading chipmakers weighed on the index.
- Oracle dropped 2.52% amid rising concerns over Nvidia’s higher chip costs.
- Micron lost 2.76%, extending its recent slide.
- Nvidia slipped 0.29% after reversing earlier gains sparked by AI optimism.
These moves capped a day of steady selling pressure in high-growth tech stocks, which have been sensitive to signs of slowing profitability.
AMD Defies the Trend
In sharp contrast to its peers, AMD surged another 3.83% to close at $211.51, breaking its previous record high of $211.38 set earlier in the year.
This advance extended Monday’s dramatic 23.71% rally, fueled by optimism over the company’s new AI chip launch and strong investor sentiment toward its growth prospects. AMD’s strong momentum has made it a standout in the semiconductor space this week.
Market Mood: Cautious but Volatile
While the broader indices failed to notch new record highs, trading volumes remained elevated as investors reacted swiftly to sector-specific headlines. The lack of macroeconomic data left markets vulnerable to individual company news, amplifying swings in tech-related shares.
Conclusion: Tuesday’s session underscored how market sentiment can shift abruptly even without fresh macro developments. Nvidia’s margin concerns were enough to dent confidence in the tech sector, proving that investor focus remains laser-sharp on profitability amid high valuations. Meanwhile, AMD’s standout rally showed that strong growth narratives still find eager buyers, keeping volatility alive in an otherwise data-starved market.
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