Nvidia, a major player in the AI industry, saw a significant increase in its shares following a three-day decline. This increase helped boost the S&P 500 and Nasdaq. The company recently faced a $430 billion loss after becoming the world’s largest company, but the recent surge in its stock price has reversed this trend.
Federal Reserve official Michelle Bowman warned that there is a possibility of interest rates increasing if inflation continues to rise uncontrollably. This news, along with Nvidia’s rebound, had a positive impact on the stock market during Tuesday’s trading session.
Analysts attribute Nvidia’s recent drop in market capitalization to profit-taking after a strong rally in 2024, rather than any significant underlying issues. Other technology giants like Amazon, Google, and Goaland also saw gains on Tuesday, further boosting investor confidence.
Despite this positive momentum in the stock market, the latest consumer confidence report showed a slight decrease. However, subcategories within the report indicated improvement in certain areas. Jeffrey Roach, the chief financial economist at LPL, highlighted the importance of the labor market in determining future consumer spending trends.
Investors are eagerly awaiting the release of personal consumption expenditures data on Friday, which will provide insights into US inflation and potential monetary policy changes. The Federal Reserve has been leaning towards a more hawkish stance, with Michelle Bowman hinting at the possibility of another rate hike in the future.
At the close of trading on Tuesday, the major US indices showed mixed results. In commodities, West Texas Intermediate Crude oil and Brent Crude both experienced losses, while gold prices also decreased. The 10-year Treasury bond saw a slight decrease in yield, while Bitcoin prices posted gains during the trading session.
Overall, the reversal in Nvidia’s stock price decline, coupled with positive movements in other tech stocks and cautious optimism in the market, contributed to a relatively positive day for US markets. Investors will continue to monitor economic data and statements from the Federal Reserve for further guidance on future market trends.
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https://markets.businessinsider.com/news/stocks/stock-market-today-nvidia-tech-rally-fed-rate-hike-inflation-2024-6
