Abigail Summerville
NEW YORK (Reuters) – The Nasdaq rose above 17,000 for the first time in history on Tuesday, helped by gains for Nvidia (NASDAQ:), while the close was marginally higher and the Dow finished lower as Treasury yields rose.
Nvidia jumped 7% and added shares in other chip stocks as investors returned from the extended holiday weekend. The semiconductor index rose 1.9%.
Technology in the S&P 500 Index saw gains among sectors, while health care saw the biggest decline along with industries.
Stocks fell in afternoon trading as U.S. Treasury yields rose to multi-week highs following frail debt auctions.
“We had two disappointing results, we saw an increase in yields and a negative (stock) market reaction,” said Quincy Krosby, chief global strategist at LPL Financial (NASDAQ:) in Charlotte, North Carolina.
“The market does not want to see yields rise sharply… to a level that will perhaps endanger the economy and consumers and thwart the (Federal Reserve’s) monetary easing schedule.”
Investors were looking forward to US inflation data this week, which may influence expectations of Fed interest rate cuts.
The core U.S. personal consumption expenditure price index report for April will be released later this week. The Fed’s preferred inflation barometer is expected to remain steady on a monthly basis.
It fell 216.73 points, or 0.55%, to 38,852.86, the S&P 500 gained 1.32 points, or 0.02%, to 5,306.04, and gained 99.09 points, or 0.59 %, up to 17,019.88.
Wall Street has been breaking records lately as investors bet that the U.S. central bank could start cutting interest rates this year.
Expectations about the timing of rate cuts have changed and policymakers are cautious as data continues to reflect volatile inflation.
According to the CME FedWatch Tool, the chances of a rate cut of at least 25 basis points exceed the 50% mark only in November and December this year. The chance of a rate cut in September has dropped to around 46% from over 50% a week ago.
The retail sector will also be in the spotlight this week, with several retailers such as Dollar General (NYSE:), Advanced car parts (NYSE:) i Best offer (NYSE:) on the results of the report.
U.S. trading will move to a shorter settlement on Tuesday, which regulators hope will reduce risk and improve efficiency but is expected to temporarily augment trade failures for investors.
Shares of Apple (NASDAQ:) rose after iPhone sales in China rose 52% in April from a year earlier, according to Reuters calculations based on industry data. However, the stock lost value over time and closed only slightly higher at $189.99.
GameStop (NYSE:) shares rose approximately 25.2% to close at $23.78. Late Friday, the video game retailer said it raised $933 million by selling 45 million shares in an “at-the-market” offering.
Hess (NYSE:) shareholders have approved a merger with the $53 billion company Chevron (NYSE:). Hess shares rose 0.4%, while Chevron shares rose 0.8%. Exxon Mobil Shares (NYSE:) closed up 1.3%.
On the Nasdaq, dwindling issues outnumbered incoming ones by a 1.34-to-1 ratio and on the NYSE by a 1.75-to-1 ratio.
The S&P 500 recorded 24 modern 52-week highs and 11 modern lows, while the Nasdaq Composite recorded 93 modern highs and 107 modern lows.
Volume on U.S. exchanges was 11.91 billion shares, compared with the average of 12.32 billion for the full session over the past 20 trading days.
