Nvidia falls from all-time highs, chip sector under pressure United Health ends down 8% after third quarter results Walgreens Boots rebounds sharply after earnings Index declines: Dow 0.75%, S&P 500 0.76%, Nasdaq 1.01%
Oct 15 (Reuters) – Wall Street’s main stock indexes closed lower on Tuesday, with semiconductor stocks falling on demand worries, the technology-heavy Nasdaq dropping 1% and energy prices falling on lower oil prices. The sector fell 3%.
Shares of UnitedHealth (UNH.N) fell 8% after the health insurer expected 2025 profits to fall below Wall Street expectations, while some financial services performance Financial results were mixed, with positive reactions being seen. The situation for the NASDAQ was particularly difficult. Under pressure from market giant NVDA.O, leading artificial intelligence chip maker NVDA.O opens a new tab. Nvidia shares fell 4.7% after hitting a record high at Monday’s close and following media reports that the Biden administration is considering restrictions on AI chip exports by U.S. companies. Chip stocks fell sharply following the financial results of chip equipment manufacturer ASML Holdings (ASML). .AS), opens in a new tab, showed lower expectations for 2025 sales. ASML’s U.S.-listed shares fell 16%, contributing to the decline in the Philadelphia Semiconductor Index (.SOX), opening a new tab of 5.3%, its biggest single-day decline since early September. .
“There seems to be a lot more stress concentrated on chips, which is putting downward pressure on technology as a sector,” said Kevin Gordon, senior investment strategist at Charles Schwab.
But while Gordon thought the lower-than-expected earnings were an excuse to sell semiconductor stocks, he was encouraged by the Nasdaq’s roughly equal number of advancers and decliners.
“It’s not a widespread washout,” he said, noting that stocks sold on that day had previously outperformed. “This shows that mega-cap stocks are pushing down the index.”
The Energy Industry Index (.SPNY) ended 3% lower for the day, as oil prices fell on lower demand expectations after media reports suggesting Israel would not attack Iranian oil targets. This was the biggest decline since early October 2023. The Dow Jones Industrial Average (.DJI) fell 324.80 points (0.75%) to 42,740.42, the S&P 500 (.SPX) fell 44.59 points (0.76%) to 5,815.26, the Nasdaq Composite Index (.IXIC), Open in new tab down 187.10 points (1.01%) to 18,315.59.
Notably, both the Dow and S&P 500 posted record closing prices in the previous session.
After energy stocks, the S&P 500 Technology Index (.SPLRCT) was the biggest decliner, falling 1.8%. York City, USA, September 18, 2024. REUTERS/Andrew Kelly/File Photo Purchase License Rights, opens in a new tab, but defense sectors including real estate (.SPLRCR) outperformed. Opens in a new tab rose the most, up 1.2%, followed by Consumer Staple Products (.SPLRCS), Open in a new tab, up 0.6%, Utilities (.SPLRCU), Open in a new tab, Increased by 0.5%. In the financial sector, Bank of America (BAC.N), Open in new tab, rose 0.5%. Shares of Charles Schwab (SCHW.N)’s Open New Tab rose 6% after the company reported better-than-expected third-quarter profits. However, Citigroup’s (CN) Open New Tab shares fell 5% after the company reported net income and mixed financial results. While debt underwriting weighed down the investment banking division’s results, net interest income was lower than expected and net interest income was lower than expected. Bucking the downtrend in tech stocks, Apple (AAPL.O) opened in a new tab ended up 1.1% after earlier hitting a record high. Walgreens also saw Boots Alliance (WBA.O)’s Open New Tab stock narrowly beat Wall Street’s downside forecast, after it announced plans to close 1,200 stores to cut costs. It rose by 15.8%.
Investors will be watching the upcoming earnings report in the coming days, as well as key economic data such as monthly retail sales and industrial production data.
San Francisco Fed President Mary Daly said early Tuesday afternoon that policymakers were still working to rein in inflation after September’s interest rate cut.
Traders are pricing in about a 98% chance that the Fed will cut interest rates by 25 basis points in November, according to CME’s FedWatch.
Declining issues outnumbered advancing issues on the New York Stock Exchange by a 1.01-to-1 ratio, with 514 new highs and 41 new lows.
On the Nasdaq, declining issues outnumbered advancing issues by a 1.05-to-1 ratio, with 2,109 advancing issues and 2,214 declining issues.
The S&P 500 Index posted 112 new 52-week highs and no new lows, while the Nasdaq Composite Index posted 173 new highs and 82 new lows.
On U.S. exchanges, 12.85 billion shares were traded, compared to an average of 12.18 billion over the past 20 days.
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Sinead Carew reports in New York and Lisa Matakkal and Purvi Agarwal in Bangalore. Editing: Pooja Desai and Matthew Lewis
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