S&P 500 ends lower, weighed down by Nvidia dip

By Johann M Cherian and Noel Randewich

(Reuters) -The S&P 500 finished lower on Monday, with AI heavyweight Nvidia (NASDAQ:NVDA ) dipping ahead of its quarterly report this week, while investors awaited inflation data for clues about the path of interest-rate cuts by the Federal Reserve.

The tech-heavy Nasdaq also declined, but the Dow Jones Industrial Average was supported by gains of about 1% each in Caterpillar (NYSE:CAT ) and American Express (NYSE:AXP ) and finished just slightly up.

Nvidia dropped 2.25% ahead of its report on Wednesday in what is set to be the U.S. stock market's most closely watched event of the week.

Some investors worried that anything short of a stellar forecast from Nvidia could shatter Wall Street's rally in AI-related companies, including Microsoft (NASDAQ:MSFT ), Alphabet (NASDAQ:GOOGL ) and Meta Platforms (NASDAQ:META ).

"Nvidia could disappoint. I think when you get to the point where the majority doesn't even suspect that there could be a piece of bad news, that's typically where you get it," warned Jake Dollarhide, chief executive of Longbow Asset Management in Tulsa, Oklahoma.

U.S.-listed shares of PDD Holdings tumbled almost 29% after the Temu-owner missed market expectations for second-quarter revenue.

Tesla (NASDAQ:TSLA ) lost 3.2% after Canada, following the lead of the U.S. and European Union, said it would impose a 100% tariff on imports of Chinese electric vehicles.

The S&P 500 declined 0.32% to end the session at 5,616.84 points.

The Nasdaq declined 0.85% to 17,725.77 points, while Dow Jones Industrial Average rose 0.16% to 41,240.52 points.

Of the 11 S&P 500 sector indexes, six declined, led lower by information technology, down 1.12%, followed by a 0.81% loss in consumer discretionary.

The energy sector index jumped 1.11% following reports of oil supply disruptions amid the geopolitical conflict in the Middle East lifted crude prices. [O/R]

Boeing (NYSE:BA ) slipped 0.85% after NASA picked SpaceX over the planemaker's Starliner to return its astronauts from space next year.

Wall Street rallied on Friday, with the S&P 500 nearing record highs after Fed Chair Jerome Powell said "the time has come" to lower borrowing costs in the light of a diminishing upside risk to inflation and moderating labor demand.

Money markets suggest traders see a 70% chance of a 25 basis point interest rate cut and a 30% chance of a 50 basis point cut in September, according to the CME Group's (NASDAQ:CME ) FedWatch tool.

Friday's highly anticipated Personal Consumption Expenditure data for July, the central bank's preferred inflation gauge, could provide more insight into the policy easing trajectory.

Results from Dell (NYSE:DELL ), Salesforce (NYSE:CRM ), Dollar General (NYSE:DG ) and Gap are on tap this week.

Advancing issues outnumbered falling ones within the S&P 500 by a 1.1-to-one ratio.



Across the U.S. stock market, declining stocks outnumbered rising ones by a 1.2-to-one ratio.

Volume on U.S. exchanges was relatively light, with 9.5 billion shares traded, compared to an average of 11.9 billion shares over the previous 20 sessions.

Source: Investing.com