Super Micro Computer, Airbnb Drop Sharply

Indexes closed lower after morning rally fizzled
By Newser Editors and Wire Services
Posted Aug 7, 2024 3:37 PM CDT
Wall Street's Morning Rally Evaporates
Traders work on the floor of the New York Stock Exchange, Wednesday, Aug. 7, 2024.   (AP Photo/Richard Drew)

Wall Street slumped on Wednesday after a morning rally evaporated, but the losses weren't as bad as the manic moves that wracked markets worldwide over the last week.

  • The S&P 500 fell 40.53 points, or 0.8%, to 5,199.50.
  • The Dow Jones Industrial Average fell 234.21 points, or 0.6%, to 38,763.45.
  • The Nasdaq composite fell 171.05 points, or 1%, to 16,195.81 .
Stocks swung lower as Nvidia, one of Wall Street's most influential companies, went from a morning gain to a loss of 5.1%, making it the heaviest weight on the S&P 500, the AP reports.

Nvidia and other Big Tech stocks have been largely struggling the last month on worries their prices shot too high amid Wall Street's frenzy around artificial-intelligence technology. A profit report from Super Micro Computer, whose stock more than quadrupled in the first two and a half months of the year, helped further mar excitement around AI. Even though its revenue soared 143% in the latest quarter, profit for the company that sells server and storage systems used in AI and other computing fell short of analysts' high expectations. Its stock tumbled 20.1%.

Treasury yields tumbled sharply Monday, when fear in the market was spiking and investors were speculating the Federal Reserve could even have to call an emergency meeting to cut interest rates quickly. But they've steadied since then. The expectation on Wall Street is for the Fed to cut its main interest rate at its next scheduled meeting next month by either the traditional quarter of a percentage point or the more severe half of a point.

story continues below

In the meantime, earnings reports from the biggest US companies continue to roll in. The Walt Disney Co. delivered stronger earnings for the latest quarter than analysts expected, and its streaming business reported a profit for the first time. But its stock nevertheless fell 4.4% after it warned recent softness it saw at its US theme parks could continue for "the next few quarters." Airbnb tumbled 13.4% after its profit in the second quarter fell short of analysts' expectations. It told investors that it saw some signs of slowing demand in the US.

(More stock market stories.)

Get the news faster.
Tap to install our app.
X
Install the Newser News app
in two easy steps:
1. Tap in your navigation bar.
2. Tap to Add to Home Screen.

X