Major stock indexes took a hit on Tuesday as wary investors dumped stocks en masse following disappointing manufacturing data. Among the big losers was Magnificent Seven darling Nvidia (NVDA), which fell more than 9%, leading the selloff of tech and semiconductor stocks on the stock market today.
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Market hits disappointing: Look out for Nvidia, Freshpet, and CyberArk
The Dow Jones Industrial Average fell 1.5%, or 626 points, after closing at an all-time high on Friday. The S&P 500 fell 2.1%, or 119 points.
Led by Nvidia’s decline, the Nasdaq’s drop was the worst of the major indexes. The tech-heavy Nasdaq Composite plunged 3.3%, or 577 points, to fall well below its 50-day moving average. Among small-cap stocks, the Russell 2000 lost 3.2%.
Trading volume on the Nasdaq and NYSE increased compared to the same time on Friday. Declining issues outnumbered advancing issues nearly four to one on the Nasdaq, while declining issues outnumbered advancing issues three to one on the NYSE.
In the bond market, the 10-year Treasury yield fell 7 basis points to 3.84%. U.S. crude oil prices fell 4.4% to $70.33 a barrel as cyclical assets weakened.
Nvidia leads market plunge
Shares of artificial intelligence chip leader NVIDIA fell 9.5% today. The company gave up a 1.5% gain on Friday and more to fall well below its 50-day moving average. The stock has fallen 7.7% in the past week.
After the close on Friday, Nvidia formed a handle, giving it a lower buy point of 131.26, but the stock is currently about 15% below that entry point, triggering a sell signal.
Nvidia’s market capitalization is on track to fall by about $280 billion by Tuesday afternoon, its biggest one-day market capitalization drop on record, according to Dow Jones Market Data.
3:41 PM ET
Manufacturing data is insufficient
Adding to the market’s selloff was the release of S&P Global’s final Purchasing Managers’ Index (PMI) for August, which came in at 47.9 compared to an expected 48.0.
But that was down sharply from July’s reading of 49.6. S&P Global said demand was starting to weaken and the drop was the first in seven months.
Also, the Institute for Supply Management’s (ISM) manufacturing index for August came in below expectations, rising to 47.2 versus the expected 47.5, but up from 46.8 in July.
Additionally, semiconductor stocks fell after Bloomberg reported that China’s factory activity contracted for a fourth straight month, suggesting the country may struggle to meet its economic growth targets. Additionally, the Semiconductor Industry Association reported on Tuesday that semiconductor sales in July were unseasonably strong.
Among the hardest-hit chip stocks were Advanced Micro Devices (AMD), down 7.6%, Broadcom (AVGO), down 6%, and Marvell Technology (MRVL), down 8%.
Vaccine maker Vaxcyte (PCVX) soared more than 37% after the company announced positive news about the early stages of testing for its pneumococcal disease vaccine. The stock is rising from a cup-handle base with a buy point of 76. The company’s shares hit an all-time high on the stock market today.
2:15pm ET
Today’s stock market: Ventilation stocks trigger sell rule
In other stock news, Comfort Systems (FIX) plunged nearly 11%, dropping below its 50-day moving average. The stock had risen 8% from a buy point of 352.46, triggering a 7% sell rule. The heating and air conditioning company, a member of Investor’s Business Daily’s IBD 50 group of stocks, is down from the all-time high it hit on Friday.
Vistra (VST) fell more than 10%, making it the biggest faller in the S&P 500 index on Tuesday. The power company dipped below its 50-day price, according to MarketSurge. The stock had recovered from a double-bottom low with a 96 buy point prior to today’s offering.
Molson Coors (TAP) pared a big gain to about 4.5% after news that it completed the sale of several craft beer brands to Tilray Brands Inc. Despite the strong performance, the stock remains below its 200-day moving average and is down 8% so far this year.
Tilray (TLRY) shares fell 2.3% on the stock market today, extending their loss so far in 2024 to 27%.
The sectors hit hardest on Tuesday were mostly concentrated in cyclical industry groups. The hardest hit was the Mining & Metallurgy group, which fell 6%, followed by Oil, Gas & Machinery, Steel & Alloys, Industrial Equipment, and Energy, all of which fell more than 5%.
But as Nvidia proved, chipmakers also fell sharply: The Philadelphia Stock Exchange’s Semiconductor Index plummeted nearly 8%.
12:14pm ET
Pet food stocks rise, bucking trend
Freshpet (FRPT) bucked Tuesday’s sell-off to rise 3.8%, moving back into a cup-based buy zone with a buy point of 136.35. The IBD 50 Stock Buy Range reaches 143.17. Freshpet is IBD’s Stock of the Day for Tuesday.
Freeport-McMoRan (FCX) fell 6.6%, tracking the decline in copper prices. The copper and gold miner is on track for its biggest percentage drop since a 6.7% drop on March 15, 2023, according to Dow Jones Market Data. The stock was one of the biggest losers in the S&P 500 index on Tuesday.
The SPDR S&P Metals & Mining (XME) exchange-traded fund also weakened. The fund fell 5.5% on the stock market today, its biggest drop since March 15, 2023, when it fell 5.9%.
Aon (AON) rose 1.3% to hit a long-base buy point of 347.37. The stock has been rising since the company reported mixed second-quarter results on July 26.
10:38 AM ET
Tesla, TG Therapeutics defy headwinds
Tesla (TSLA) rose 2%. The company said its August sales in China increased 17% from July and 3% from August 2023. Tesla shares are down about 14% so far this year but are forming a bottom.
IBD 50 stock TG Therapeutics (TGTX) pared its morning gains to 1.6%, but was still up slightly from a 22.67 buy point. The autoimmune drug maker fell after hitting a 52-week high in heavy trading on the stock market today.
Market beats expectations on Nvidia’s record offering
Stock market today: Dow component Boeing falls
Dow Jones stock Boeing (BA) fell about 8% after Wells Fargo downgraded the stock to underweight from equal weight and lowered its price target to $119 from $185. The stock dipped further below its 200-day moving average in the stock market today.
Boeing shares are on track to close at their lowest since a closing price of $160.01 on Nov. 4, 2022, according to Dow Jones Market Data. The aerospace and defense stock was the biggest faller among the 30 Dow Jones industrials on Tuesday and has fallen 37% so far this year.
Novartis (NVS) fell 1.5% after Jefferies downgraded the stock to “hold” from “buy” and cut its price target to 105 from 110. The stock hit a record high on Friday. The company’s shares are rising from a cup base with a buy point of 103.55.
NetApp (NTAP) fell 0.4% on the stock market today after Loop Capital upgraded the stock to buy from hold and raised its price target to 150 from 121. Shares plunged 9.6% on Thursday on higher trading volume, despite the company’s first-quarter adjusted earnings and net revenues beating expectations.
The data storage stock remains below its 50-day moving average but is in a cup base with a buy point at 134.37.
For more stock market news, follow Kimberley Koenig on Twitter @IBD_KKoenig.
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