Dow, S&P 500, Nasdaq Down; Nvidia, Marvell, Dell, Alibaba, More Movers; PCE Inflation Report
The stock market struggled in the final session before Labor Day, as Wall Street opted to cap off August by selling highflying tech stocks.
The Dow Jones Industrial Average fell 92 points, or 0.2%. The S&P 500 was down 0.6%. The Nasdaq Composite was down 1.2%.
Tech was the S&P’s worst sector, led lower by Nvidia and other key artificial intelligence players like Super Micro Computer and Broadcom. Consumer discretionary, industrials, and communication services also struggled.
Instead, the winning strategies of the day included funds focused on dividends, low volatility, and value stocks. Such strategies have lagged behind risk, growth, and momentum this summer, so today’s action could be a case of end-of-month rebalancing.
September is also historically been a tough stretch for the stock market, so some on Wall Street may be looking to play defensive.
The bond market was paying attention to the legal battle between Federal Reserve governor Lisa Cook and the Trump administration. The yield on the 2-year Treasury note was down to 3.62%, while the 10-year yield was up to 4.23%.
The White House is seeking to fire Cook after Bill Pulte, director of the Federal Housing Finance Agency, accused Cook of mortgage fraud. President Donald Trump has repeatedly attacked Fed Chairman Jerome Powell for the central bank’s decisions to keep interest rate steadies amid worries about tariff inflation.
If the president successfully removes Cook and replaces her with an ally, he could hold more influence on the central bank’s policy committee.
“Fed independence continues to be a concern, but not a fear as of yet,” writes Andrew Brenner, head of international fixed income at NatAlliance Securities.
Odds of a quarter-point cut rose to 86.9% on Friday from 84.7% a week ago, according to the CME FedWatch Tool.
Brenner doesn’t see a half-point cut as likely.
“But with two big numbers out from the labor department over the next 10 days, it should get exciting,” he writes.
