The Nasdaq ended sharply lower on Thursday, hit by losses in Nvidia, Apple and Tesla as investors rotated into smaller companies after softer-than-expected inflation data fed bets the Federal Reserve will cut interest rates in September.
Market Snapshot
The S&P 500 declined 0.88% to end the session at 5,584.54 points. The Nasdaq declined 1.95% to 18,283.41 points, while Dow Jones Industrial Average rose 0.08% to 39,753.75 points.
Market Movers
Tesla - Tesla snapped its 11-session winning streak as the stock fell 8.4%. A report from Bloomberg said the electric-vehicle maker was delaying its plannedrobotaxi unveilingto October from Aug. 8. Excitement surrounding the robotaxi event was, in part, why Tesla’s stock recently has rallied.
Nvidia - Nvidia declined 5.6%. A “sell the news” reaction to the latest inflation data looked to bedragging on shares of the chip maker. Nvidia has risen 157% this year.
Apple - Apple fell 2.3% after hitting a record high on Wednesday. BofA Global Markets raised its price target for Apple, saying it expects strong iPhone sales driven in part by new AI features.
MicroStrategy - MicroStrategy was up 4.1% after the company declared a10-for-1 stock split. MicroStrategy is the largest corporate holder of Bitcoin, and the stock has rallied 115% this year.
Delta Air Lines, United Continental, American Airlines - Delta Air Lines reported second-quarter adjusted earnings of $2.36 a share on revenue of $16.7 billion. Wall Street expected the carrier to post second-quarter profit of $2.37 a share, down from $2.68 a year earlier. Revenue was forecast at $15.45 billion.
Delta said it expects earnings in the current third quarter of $1.70 to $2 a share, below analysts’ predictions of $2.04. The stock slid 4%. United Airlines declined 3.2% and American Airlines dropped 3.8% after Delta’s results.
Pfizer - Pfizer was up 1.1% after the drug company said it was advancing the development of itsonce-daily weight-loss pillfollowing promising data.
Pepsi - PepsiCo reported second-quarter adjusted earnings of $2.28 a share, beating analysts’ estimates of $2.16 a share. Revenue of $22.5 billion came up just shy of estimates of $22.6 billion. Organic revenue in the quarter rose 1.9%. The stock gained 0.2%.
Quantumscape - QuantumScape surged 31% after the company formed an agreement with Volkswagen “to industrialize” the company’snext-generation solid-state electric-vehicle batteries.
D.R. Horton, Builders FirstSource - Home builders such as D.R. Horton, up 7.3%, got a lift from growing hopes of interest rate cuts sooner rather than later. Building-materials supplierBuilders FirstSource rose 7.4%.
ConAgra - Conagra Brands fell 1.5% after the packaged-food company beat quarterly earnings estimates butissued weak guidancefor fiscal 2025.
WD-40 - WD-40 was up 4% after fiscal third-quarter earnings and revenue from the lubricants company topped analysts’ estimates. Revenue rose 9% to $155 million, beating analysts’ expectations of $145.8 million. WD-40 said sales in the Americas region rose 6% in the period.
Market News
US Inflation Broadly Cools, Likely Sealing Deal for Fed Rate Cut
US inflation cooled broadly in June to the slowest pace since 2021 on the back of a long-awaited slowdown in housing costs, sending the strongest signal yet that the Federal Reserve can cut interest rates soon.
The so-called core consumer price index — which excludes food and energy costs — climbed 0.1% from May, the smallest advance in three years, Bureau of Labor Statistics figures showed Thursday. The overall measure fell for the first time since the onset of the pandemic, dragged down by cheaper gasoline.
Similar to the May CPI report — which Fed Chair Jerome Powell described this week as “really good” following an unexpected flare-up in the first quarter — the June reading will go a long way toward giving Powell and his colleagues the confidence they need to cut rates, likely starting in September. Policymakers will have a chance to signal such a move may be coming when they meet later in July, especially since unemployment has now risen for three straight months.
Tesla Plans to Delay Robotaxi Unveiling to October From August
Tesla Inc. is postponing its planned robotaxi unveiling to October to allow teams working on the project more time to build additional prototypes, according to people familiar with the decision.
The roughly two-month delay has been communicated internally, said the people, who asked not to be identified because the information hadn’t been publicly announced. The design team was told this week to rework certain elements of the car, one of the people said.
Chief Executive Officer Elon Musk set the initial Aug. 8 date for the event months ago, and optimism about the spectacle has contributed to an 11-day streak of gains that added more than $257 billion to Tesla’s market capitalization. The stock closed 8.4% lower on Thursday, its largest drop since January.