Stocks were mixed on Thursday as outsized gains from Nvidia (NVDA) sparked a tech rally while markets remained on debt ceiling worries.
The S&P 500 (^GSPC) was up 0.88%, while the Dow Jones Industrial Average (^DJI) was down 0.11%. The tech-heavy Nasdaq Composite (^IXIC) gained 1.71%.
Shares of Nvidia soared Thursday, up about 24.37%, as the tech giant’s second-quarter guidance shocked Wall Street. Nvidia, which has quickly become a leader in the growing artificial intelligence arms race, forecast second-quarter revenue of $11 billion. According to Bloomberg data, analysts had expected $7.2 billion.
Other AI-related stocks rose alongside Nvidia as Alphabet (GOOGL) gained more than 2% and Microsoft (MSFT) gained nearly 4%.
“In the 22 years that we’ve been covering tech stocks and large-cap stocks, we’ve never seen a forecast range of this magnitude for a large-cap tech name,” Wedbush chief executive Dan Ives wrote in a Thursday Note. “And that supports our thesis that AI monetization is well underway for established companies like Microsoft, Alphabet, Amazon, Oracle, Meta, Apple and Salesforce.”
Meanwhile, uncertainty over the debt ceiling is weighing on the broader market. On Wednesday night, Fitch warned that it could downgrade the United States’ AAA credit rating.
“Fitch continues to expect a debt ceiling resolution before X date,” Fitch wrote in the statement. “However, we believe that the risk has increased that the debt ceiling will not be lifted before the
President Joe Biden speaks at the White House on May 5, 2023. (` Photo/Evan Vucci)
In other earnings news, shares of Snowflake (SNOW) fell 16.49% as the cloud computing company reported weaker-than-expected second-quarter sales.
Best Buy (BBY) stock rose just over 3% as the company reported earnings per share of $1.15. Wall Street had expected $1.11. However, the tech retailer missed the Street’s sales estimates as same-store sales plunged 10% in the quarter.
The story goes on
On the economic front, jobless claims for the week ended May 20 came in lower than expected with 229,000 claims filed. Economists had expected 245,000. A secondary measurement of quarterly GDP showed that the US economy grew 1.3% in the first quarter. First printing indicated growth of 1.1%.
Josh is a reporter for Yahoo Finance.
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