- US stocks were mixed on Wednesday after notching their worst losses since the big sell-off in early August.
- Nvidia shares lost another 3% in early trades, weighing on the S&P 500 and the Nasdaq.
- Investors were spooked after reports the AI titan is being probed by the DOJ over antitrust concerns.
US struggled to regain momentum on Wednesday after the market saw its worst loss since the early August sell-off in the previous session.
The Dow Jones Industrial Average edged up slightly, while the S&P 500 and the Nasdaq Composite were both lower, weighed down by shares of Nvidia. The chip titan shed another 3% after a report from Bloomberg that said the company was being probed by the US Department of Justice over antitrust concerns. The loss adds to Wednesday's decline of about 7% for the artificial intelligence darling.
"Have we seen peak-NVIDIA, or is this simply a healthy correction? Much depends on growth in generative AI, along with the ability of other chip makers to offer up some competition," David Morrison, a senior market analyst at Trade Nation, said in a note.
Traders, meanwhile, remain nervous about the possibility of a recession. All eyes will be on the August jobs report at the end of the week, but investors are already anticipating steep rate cuts from the Fed by year-end, per the CME FedWatch tool, a sign that they expect swift policy changes from the central bank to combat a weakening economy.
Bank of America said this week that a too-hot labor report was the biggest risk to stocks in the coming days, as any surprise strength in the employment picture could recalibrate the odds of deep rate cuts.
Manufacturing data on Tuesday was weaker than expected, reigniting concerns that the economy is headed for a slowdown. Bond yields dipped on Wednesday, with the 10-year Treasury falling two basis points to 3.82%.
Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Wednesday:
- S&P 500: 5,517.77, down 0.18%
- Dow Jones Industrial Average: 41,057.85, up 0.3% (+120.92 points)
- Nasdaq composite: 17,023.66, down 0.66%
Here's what else is going on:
- Stocks could drop as much as 10% over the next 8 weeks, according to one bullish forecaster who's nailed his calls this year.
- AI could weigh down oil prices over the next decade, Goldman Sachs said.
- Here's why one top economist remains worried about a recession despite a still-growing economy.
In commodities, bonds, and crypto:
- Oil futures inched lower. West Texas Intermediate crude oil dipped 0.6% to $69.90 a barrel. Brent crude, the international benchmark, was down 0.6% to $73.33 a barrel.
- Gold dipped 0.15% to $2,489.36 an ounce.
- The 10-year Treasury yield slipped two basis points to 3.82%.
- Bitcoin dropped 4.53% to $56,568.