Yahoo Finance Stock Market News for Feb 21, 2024
Wall Street closed sharply lower on Tuesday, dragged down by tech and discretionary stocks. Chip stocks, in particular, weighed the heaviest on the markets. All of the three major stock indexes ended in the red.
How Did the Benchmarks Perform?
The Dow Jones Industrial Average (DJI) slid 64.19 points, or 0.2%, to close at 38,563.80. Sixteen components of the 30-stock index ended in negative territory, while 14 ended in positive.
The tech-heavy Nasdaq Composite lost 144.87 points, or 0.9%, to close at 15,630.78.
The S&P 500 dropped 30.06 points, or 0.6%, to close at 4,975.51. Ten of the 11 broad sectors of the benchmark index closed in the red. The Technology Select Sector SPDR (XLK), the Consumer Discretionary Select Sector SPDR (XLY) and the Energy Select Sector SPDR (XLE) declined 1%, 0.9% and 0.9%, respectively, while the Consumer Staples Select Sector SPDR (XLP) advanced 1.1%.
The fear-gauge CBOE Volatility Index (VIX) increased 4.8% to 15.42. A total of 11.7 billion shares were traded on Tuesday, higher than the last 20-session average of 11.6 billion. Decliners outnumbered advancers by a 1.4-to-1 ratio on the NYSE. On the Nasdaq, declining issues outnumbered advancing ones by a 1.9-to-1 ratio.
Nvidia Weighs on the Markets
NVIDIA Corporation NVDA, which is set to report earnings today after the bell, saw its shares plunge nearly 4.4% on Tuesday. Nvidia has seen a meteoric rise on AI optimism since the onset of 2023 and has recently become the most-traded stock on Wall Street. Its valuation has gone off the charts and it is currently the third most valuable company based in the United States.
While some may raise eyebrows about its stocks falling ahead of quarterly earnings, the general consensus is that a profit-booking spree may have led to the fall. Also, while market expectations from the company are that it will post impressive results, investors have expressed concerns about its sky-high valuation.
This weighed on chip stocks and the tech sector in general as the tech-focused Nasdaq bore the heaviest burden in the session. Also, the Philadelphia Semiconductor Index slumped 1.6%. The tech sector has continued its momentum this year, lagging only the communication services (which is also a broader part of the tech sector itself) and health sectors in 2024. However, it has now receded over a week and a half over interest rate concerns, and now this.
Consequently, shares of Super Micro Computer, Inc. SMCI and Amazon.com, Inc. AMZN slid 2% and 1.4%, respectively. Both currently carry a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
No economic data was released on Tuesday.
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