The Nasdaq Composite, which is heavily weighted towards technology stocks, hit a new milestone on Tuesday, surpassing 17,000 for the first time. This was driven by the impressive performance of AI company Nvidia, which reached a record high of $1,140 per share after its earnings report.
Meanwhile, the S&P 500, a broader market index, ended the day slightly above its previous closing level, while the Dow Jones Industrial Average fell by 0.6%, losing over 200 points.
These market movements come after a volatile week, as traders return from the Memorial Day holiday. The stock market has been influenced by two conflicting factors: diminishing optimism for interest rate cuts on one hand, and high expectations for artificial intelligence on the other.
Investors are now closely watching for signs of inflation, eagerly awaiting the release of the Federal Reserve’s preferred PCE gauge on Friday. Fed officials have been consistently warning that there must be concrete evidence of cooling inflation in order for any policy changes to take place, with Neel Kashkari being the latest to echo this sentiment.