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Nasdaq faces tough start to September as Nvidia sell-off continues

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U.S. stocks fell Tuesday to kick off a historically difficult month for markets, as AI darling Nvidia (NVDA) and chip stocks dragged technology stocks lower. Meanwhile, attention turned to a week of data on the economy and the labor market highlighted by a crucial monthly employment report.

The Dow Jones Industrial Average (^DJI) fell 1%, or more than 400 points. The S&P 500 (^GSPC) fell 1.4%, while the Nasdaq Composite (^IXIQUE) fell by 2.4%.

Stocks are pulling back from near-peak highs as Wall Street retreats after a turbulent August, with the prospect of a potentially stormy September ahead. Investors are weighing the risk of statistical shocks or surprises in the presidential race in a month that generally terrible for traders.

Early trading on Tuesday didn’t exactly offer a rosy outlook. Nvidia (NVDA) fell more than 7% on Tuesday as investors continued to pull back after a disappointing earnings report and lingering questions about the future of the AI ​​sector. Other chip stocks fell at the same time, including Broadcom (AVGO), Qualcomm (QCOM) and Taiwanese semiconductor manufacturing company (TSM) all down more than 5%.

The August jobs report, due out Friday, is also likely to be in focus. It could influence how much the Federal Reserve cuts interest rates at its meeting later this month. With inflation falling, policymakers are on alert for the labor market to recover.

For investors, the focus is on whether Signs of slowdown in July jobs report The Fed’s forecasts were either overblown or an early warning of a broader slowdown. Any sign of stress should put pressure on the Fed to cut rates more. On Tuesday, traders were pricing in a 31% chance of a 50 basis point cut instead of a 25 basis point cut. according to the CME FedWatch tool.

The U.S. manufacturing activity index edged up last month, according to the latest figures from the Institute for Supply Management (ISM). But the indicator reflects a slowdown in industrial activity, with the reading below the threshold suggesting a contraction in manufacturing.

Live4 updates

  • Construction spending falls more than expected

    While the August jobs report, released Friday, is the main event in scheduled economic news this week, Tuesday offered a snapshot of construction activity, with implications for the housing market.

    The Commerce Ministry reported Tuesday that Construction spending fell 0.3% in Julycompared with no change the previous month. The forecast was for spending to fall by just 0.1%.

    The slightly larger-than-expected decline in spending reflects higher mortgage rates and greater supply.

    The drop in demand has prompted builders to slow the pace of their construction projects. In July, single-family home construction hit a 16-month low.

    However, Mortgage rates continued to fall in August Expectations are growing that the Federal Reserve will cut rates at its next policy meeting in September. Rates are expected to fall further as potential buyers wait for better rates.

    Affordability remains an issue, although borrowing costs are likely to fall.

    Purchasing the Fannie Mae House The consumer confidence index, which measures consumer sentiment toward the residential real estate market, fell in July, highlighting how lack of affordability is holding back real estate activity.

  • Why We’re Not Ready for the First Presidential Election of the AI ​​Era

    With the election just months away and generative AI sensing technologies being a hit or miss, experts say we can expect to see more generative AI-powered content. designed to sow discord among the electorate, the reports Dan Howley of Yahoo Finance.

    The 2024 election is the first US presidential election in the era of generative AI, and we’re already seeing examples of this technology being used to influence how Americans vote.

    On August 18, former President Donald Trump shared a series of AI-generated images of Taylor Swift fans wearing pro-Trump T-shirts, despite the fact that the photos originally appeared in a post marked as satire on X (formerly Twitter)In January, deepfake phone calls were sent to some New Hampshire residents, attempting to discourage them from participating in the state’s Democratic primary.

    “The danger is that if there is some type of AI misinformation… like the Taylor Swift images… if millions of people are exposed to it and only 10 or 15 percent don’t realize it’s false, that could be a substantial number to think about in the election,” said Lance Hunter, a political science professor at Augusta University.

    “In key states, the margin of victory is sometimes less than 1%. So a small number of people exposed to this misinformation and not realizing it is misinformation could have an influence on the outcome of the election,” Hunter added.

    Learn more here.

  • Stock market trends in morning trading

    Here are some of the top stocks on Yahoo Finance trend tickers page during the Tuesday morning exchanges:

    Boeing (License): Shares of the aircraft manufacturer fell 6% Tuesday morning after a price target cut from Wells Fargo, highlighting the strain on the company’s cash flow as it works to develop new planes. The company also faces a potential major strike, as its Washington state workers are expected to go on strike if a deal isn’t reached later this month.

    American Steel (X): The steel producer fell nearly 4% after Democratic candidate Kamala Harris said the company should remain American owned and operated facing a proposed takeover by the Japanese group Nippon Steel. Republican candidate Donald Trump has also opposed this proposed sale.

    Nvidia (NVDA): Shares of the artificial intelligence chip maker fell 5% Tuesday morning, continuing a slide that accelerated after the company’s earnings release last week failed to impress Wall Street. The stock has fallen more than 10% in the past five days, highlighting a tough time for AI and chip companies that have been stagnant as questions about their customers’ returns on investment grow louder.

    Unit (You): The video game software developer gained more than 7% Tuesday after Morgan Stanley analysts upgraded its stock to Equal Weight from Overweight, highlighting strength in its game engine business and Unity’s hold on its market share.

  • Stocks fall in morning trading

    U.S. stocks fell Tuesday to kick off September, a historically difficult month for markets as attention turned to a work week data highlighted by a crucial monthly jobs report.

    The Dow Jones Industrial Average (^DJI) slipped about 0.5% in the wake of a winning session booked before the Labor Day break. The S&P 500 (^GSPC) fell 0.6% while the Nasdaq Composite (, a technology-heavy index)^IXIQUE) fell by 0.8%.

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