Stock Market Today: How The Tech Sell Off Is Going?
Nasdaq Leads Gains to Kick Off New Quarter as Tesla Pops 6%
What Is Leading the Stock Market?
Market Overview:
US stocks edged higher on Monday, kicking off the second half and third quarter of 2024. Investors are counting down to the July 4 break and the release of the key US jobs report.
- Dow Jones Industrial Average (^DJI): +0.1%, closing at 39,122.94
- S&P 500 (^GSPC): +0.3%, closing at 5,460.30
- Nasdaq Composite (^IXIC): +0.8%, closing at 17,732.60
Highlights:
- Tesla (TSLA): Stock surged approximately 6% ahead of its quarterly delivery results due out on Tuesday.
- Nvidia (NVDA): Shares rebounded, temporarily alleviating concerns about the chipmaker's trading conditions.
- Amazon (AMZN) and Apple (AAPL): Both gained roughly 2%.
Key Events:
June Jobs Report: The upcoming jobs report on Friday is highly anticipated. Signs of a cooling labor market could justify potential interest rate cuts by the Federal Reserve. Encouraging signs of inflation slowing towards the Fed's target, combined with emerging economic weaknesses, have fueled hopes for a policy shift.
US Manufacturing Data: The Institute for Supply Management’s manufacturing PMI fell further into contraction territory in June, reaching a four-month low, highlighting ongoing challenges in the manufacturing sector.
Political Risks: US political uncertainties are increasing, with questions surrounding President Joe Biden’s future as the Democratic Party’s leader, particularly after the recent US presidential debate.
Tech Sector Performance: Tech stocks and consumer discretionary sectors led the gains. The shortened trading week, due to the Fourth of July holiday, sees a focus on tech giants:
- Nvidia (NVDA): Recovered from early session losses.
- Tesla (TSLA): Jumped 6% in anticipation of delivery numbers.
- Amazon (AMZN) and Apple (AAPL): Each added about 2%.
Market Trends and Analysis:
Summer Market Volatility: Historically, the S&P 500 experiences increased volatility during the summer months. Since 1970, the S&P 500 has averaged seven single-day declines of 1% or more during June, July, and August. This year, however, the S&P 500 has not yet experienced such a drawdown, suggesting a possible new record for summer trading stability.
Investor Sentiment: Stocks are experiencing a bumpy ride as the trading week, shortened by the Independence Day holiday, begins. Investors are debating whether the second half of the year will see a pullback or a broadening of the tech-driven rally that has lifted the S&P 500 to a nearly 15% gain so far in 2024.
Company-Specific News:
Tesla (TSLA): Tesla's stock surged 6% ahead of its quarterly delivery results. The company's performance is closely watched as a bellwether for the EV sector and broader market sentiment.
Nvidia (NVDA): Nvidia shares erased earlier losses, temporarily easing investor worries about the company's valuation and market conditions. Nvidia remains a leader in AI technology, driving significant interest and market activity.
Amazon (AMZN) and Apple (AAPL): Both companies saw gains of about 2%, contributing to the overall positive performance of the tech sector.
Conclusion:
The stock market shows resilience as it starts the third quarter, led by significant gains in tech stocks like Tesla and Nvidia. With the upcoming jobs report and potential Federal Reserve rate cuts, investors are cautiously optimistic. However, historical trends suggest that summer may bring increased volatility, and political uncertainties add to the market's complexity. Investors are closely monitoring economic indicators and corporate earnings to navigate the evolving market landscape.