U.S. stocks wobbled on Thursday after chipmaker Micron’s (MU) prospects put a dent in hopes for a tech rally, as investors assessed new economic data ahead of inflation data key to Federal Reserve policy.
The S&P 500 (^GSPC) was little changed after Wednesday’s rise, closing not far from a new all-time high. The Dow Jones Industrial Average (^DJI) fell 0.1%, while the tech-heavy Nasdaq Composite (^IXIC) was also flat.
Shares are struggling in the wake of Micron’s current quarter sales forecasts, which met expectations but failed to satisfy investors looking for stellar performance from AI-connected companies.
Bullishness around AI has helped push the benchmark S&P 500 to a 15% gain this year. But concerns are growing that the rally could be in jeopardy if the handful of technology companies driving most of those gains fail to beat already-lofty expectations.
Shares of memory maker Micron fell more than 4% in early trading. Nvidia (NVDA) fell about 1%, reviving concerns about a return to the sell-off that roiled markets last week.
Investors weighed a new batch of economic data on Friday ahead of PCE inflation, which will influence the Fed’s thinking about the timing of rate cuts.
Initial weekly unemployment claims totaled 233,000, down 6,000 from the previous week, according to Labor Department data. The print came in below the consensus expectation of 235,000. But recurring unemployment claims rose to the highest level since late 2021, indicating that it is taking longer for the unemployed to find jobs.
Real gross domestic product (GDP) rose at an annual pace of 1.4% in the first quarter of 2024, according to the Bureau of Economic Development’s third estimate released Thursday morning. The print was slightly higher than the previous estimate of 1.3%.
Inflation could also get big Thursday night during the first debate between President Joe Biden and former President Donald Trump.
On the corporate front, shares of Levi Strauss (LEVI) fell more than 15% after second-quarter revenue misses for the jeans seller. Investors will look to Nike’s ( NKE ) quarterly results after the bell for more clues about consumer resilience.
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