US stock market: Nvidia shares pull down Nasdaq, but Dow Jones at one month-high

Wall Street closed with a mixed performance on Monday, as gains in industrial stocks boosted the Dow Jones Industrial Average while a retreat in leading tech names weighed on the Nasdaq Composite Index.

The Dow Jones Industrial Average advanced 0.7 per cent to settle at a one-month high of 39,411.21, lifted by strong performances in oil-and-gas shares and financials. The broad-based S&P 500, however, dipped 0.3 per cent to 5,447.87, dragged down by losses in select technology stocks. The tech-heavy Nasdaq Composite fared worse, declining 1.1 per cent to 17,496.82.

Market movers

Among the notable gainers, Exxon Mobil surged 3 per cent alongside a 4 per cent rise in oilfield services provider SLB, buoyed by robust oil prices nearing highs not seen since April.

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Financial stocks also showed strength, with JPMorgan Chase up 1.3 per cent and Wells Fargo climbing 1.6 per cent ahead of anticipated Federal Reserve stress test results later in the week.

However, the session saw significant declines among high-profile tech stocks, most notably Nvidia, which plummeted 6.7 per cent for a third consecutive session. Nvidia, known for its meteoric rise since late 2022, has faced recent headwinds in the market.

Rotating portfolios

Investors rotated their portfolios, pulling out of artificial intelligence-linked equities in favour of underperforming sectors, driven by expectations of potential Federal Reserve interest rate cuts later this year.

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The focal point for market participants remains Friday’s release of the personal consumption expenditures (PCE) price index, a key gauge of inflation preferred by the Federal Reserve. Expectations are for a moderation in inflationary pressures, influencing market expectations of potential rate cuts. According to LSEG’s FedWatch tool, there is a 61% probability priced in for a 25-basis-point rate reduction in September, contrasting with the Fed’s latest projections hinting at a likely cut in December.

In the bond market, Treasury yields moderated slightly, with the yield on the 10-year Treasury declining to 4.23 per cent from 4.26 per cent at the close of trading on Friday.

With inputs from agencies