Key things
- U.S. stocks ended mixed on Thursday, May 25, 2023 as news from Nvidia lifted the Nasdaq and S&P 500 and fears of a possible government default dragged down the Dow.
- Nvidia said demand for its AI products is “growing”.
- Dollar Tree becomes the latest retailer to report the theft is impacting profits.
U.S. stocks ended mixed as tech stocks rallied on Nvidia (NVDA) much better than expected quarterly results and outlook, while concerns about what would happen if a deal to raise the federal debt ceiling is not reached in time to avoid a US default dragged down the Dow. The yield on the 10-year Treasury rose after Fitch downgraded the U.S. credit rating to negative as the so-called X-date for a government default approached.
Nvidia (NVDA) shares jumped to an all-time high after the chip maker reported a “surge” in demand for them artificial intelligence (AI) products. The news lifted shares of other stocks in the AI sector, including Advanced Micro Devices (AMD), Used materials (AMAT) and TSMC (TSM). Microsoft stock (MSFT), which has made a significant commitment to AI, has also acquired. However, Intel (INTC) shares fell 5.5% as booming sales to its rivals threaten to cut into its earnings.
Ralph Lauren Corporation (RL) shares rallied after the apparel retailer beat profit forecasts as sales jumped in China. Shares of Synopsys (SNPS) grew by $300 million, which the software maker accelerated share buyback agreement with Mizuho Markets Americas.
dollar tree (DLTR) slumped after the discount store chain missed profit estimates and cut its full-year outlook due to theft losses. American Eagle Outfitters (AEO) also cut its lead and the stock plunged. Shares of Medtronic (MDT) fell after the medical device maker’s full-year profit forecast came in lower than expected.
Illumina (ILMN) shares fell after one of the activist investors Carl Icahn board candidates won a seat at Thursday’s stockholder meeting, ousting Chairman John Thompson. Drugmaker stocks weighed on the Dow with shares of Amgen (AMGN), Johnson & Johnson (JNJ) and Merck (MRK) all fell by more than 1%.
Oil futures fell 3% after a Russian official said Moscow did not expect OPEC+ members to implement further production cuts. Gold prices fell. The US dollar was higher against the euro, pound and yen. Most major cryptocurrencies are trading in positive territory.
