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Stock market today: Losses for Big Tech companies lead Wall Street lower

Losses for several big technology companies pulled the stock market lower. The S&P 500 fell 0.6% Wednesday, weighed down by drops in Nvidia, Apple, Microsoft and Amazon. The Dow Jones Industrial Average fell 0.4%.
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Flags fly on the side of the New York Stock Exchange with Trinity Church in the background on Wednesday, Aug. 28, 2024, in New York. (AP Photo/Peter Morgan)

Losses for several big technology companies pulled the stock market lower. The S&P 500 fell 0.6% Wednesday, weighed down by drops in Nvidia, Apple, Microsoft and Amazon. The Dow Jones Industrial Average fell 0.4%. The Dow is coming off two consecutive all-time highs. The Nasdaq composite fell 1.1%. Nvidia is set to report its latest results after the closing bell. Its revenue is expected to have surged to $28.74 billion, more than double the same period a year ago. Nordstrom rose after the department store chain easily surpassed Wall Street’s profit expectations. Treasury yields held steady in the bond market.

THIS IS A BREAKING NEWS UPDATE. AP’s earlier story follows below.

Stocks fell broadly on Wall Street in afternoon trading Wednesday ahead of an eagerly anticipated earnings report from the semiconductor company Nvidia, whose chips power AI applications.

The S&P 500 fell 1%, with more than 70% of the stocks in the benchmark index in the red. Tech sector stocks, which include many companies with outsized values that tend to lean more heavily on the index, were the biggest drag on the market.

The Dow Jones Industrial Average fell 351 points, or 0.9%. The index is coming off two consecutive all-time highs. The Nasdaq composite fell 1.6% as of 2:43 p.m. Eastern.

Investors had a mixed batch of earnings and corporate financial updates to review. Nordstrom rose 2.9% after beating analysts' earnings expectations and raising its financial forecasts for the year. Rival Kohl's rose 1.1% after also beating analysts' earnings expectations.

PVH, which owns the Calvin Klein and Tommy Hilfiger brands, fell 6.3% after giving investors a revenue forecast short of analysts’ expectations. Food producer J.M. Smucker fell 4.9% after trimming its earnings forecast for the year.

Super Micro Computer sank 20.4% for the biggest decline among S&P 500 stocks after the server technology company said it was delaying the filing of its annual report.

The latest results from retailers and others come as Wall Street and the Federal Reserve try to gauge the resiliency of U.S. consumers amid the squeeze from inflation and high borrowing rates. The latest updates from clothing retailers, food producers and others can help shed more light on how and where people are spending money.

Most investors and market watchers are fixated on the upcoming Nvidia earnings report, expected after the market closes on Wednesday. It is one of the most influential stocks on Wall Street, with a total market value topping $3 trillion.

Nvidia is one of several companies that have ridden a wave of enthusiasm over artificial intelligence developments and have been responsible for much of the broader market's big gains over the last year.

Nvidia fell 2.8%, though it is up 152% for the year.

Investors are also looking ahead to Friday, when the U.S. government releases its latest data on inflation with the PCE, or personal consumption and expenditures report, for July. The hope is that the data shows inflation easing further — or at least stagnating — so that Fed officials remain comfortable cutting interest rates at their September meeting as they've strongly suggested they would.

Economists expect the PCE, which is the Fed's preferred measure of inflation, to show that inflation edged up to 2.6% in July from 2.5% in June. It was as high as 7.1% in the middle of 2022. The rate of inflation has been easing steadily back toward the central bank's target of 2% since then, following the Fed's aggressive interest rate hikes.

Traders expect the central bank to begin trimming its benchmark interest rate back from a two-decade high at its next meeting in September, with cuts totaling up to 1% by the end of the year.

The expectations for those interest rate cuts follow reports on retail sales, employment and consumer confidence that show the economy continues to remain strong. That has helped build confidence that the Fed will accomplish its goal of taming inflation without stalling the economy into a recession.

“Economic fundamentals continue to point to sustainable disinflation," said Gregory Daco, chief economist at EY.

Treasury yields were mixed in the bond market. The yield on the 10-year Treasury rose to 3.84% from 3.83% on Tuesday.

Investor Warren Buffett’s Berkshire Hathaway unloaded more of its Bank of America stake, selling nearly 25 million shares worth almost $1 billion over the past week. Berkshire Hathaway's Class A stock, already the most expensive stock on Wall Street, gained enough ground to elevate the conglomerate into the club of companies valued by the stock market at over $1 trillion. It's the only company outside of the technology-related “Magnificent Seven” with that distinction.

Elsewhere, markets were mostly lower in Europe and mixed in Asia.

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Yuri Kageyama and Matt Ott and Josh Funk contributed.

Damian J. Troise And Alex Veiga, The Associated Press