FX.co ★ U.S. Stocks Move Mostly Lower As Early Buying Interest Evaporates

Stocks initially rose on Thursday but failed to maintain their gains, coming under pressure throughout the session. The major indices retreated from their early highs, moving into negative territory by the close.

The Nasdaq dropped 65.51 points, or 0.4%, to 16,736.03, while the S&P 500 fell 39.17 points, or 0.7%, to 5,267.84. The Dow experienced a more pronounced decline, plummeting 605.78 points, or 1.5%, to 39,065.26.

Early strength on Wall Street was driven by a rally in tech stocks following strong quarterly results from Nvidia (NVDA). The chipmaker's shares soared after it reported better-than-expected fiscal first-quarter results and provided optimistic guidance. Additionally, Nvidia announced a ten-for-one stock split and a 150% increase in its quarterly cash dividend to $0.10 per share.

However, buying interest waned as concerns about the outlook for interest rates persisted following Wednesday's somewhat hawkish Federal Reserve minutes. With indications from the minutes that rates could remain elevated longer than previously anticipated, market expectations that rates would decrease by September dropped to 55.4%, according to the CME Group's FedWatch Tool.

Adding to rate concerns, the U.S. Labor Department reported a larger-than-expected decline in first-time unemployment claims for the week ending May 18th. Initial jobless claims fell to 215,000, down 8,000 from the prior week's revised figure of 223,000, exceeding economists' forecasts of a drop to 220,000.

**Sector News**

Networking stocks experienced a significant decline, pulling the NYSE Arca Networking Index down by 2.4%. Interest rate-sensitive sectors such as utilities and commercial real estate also saw notable weakness, with the Dow Jones Utility Average and the Dow Jones U.S. Real Estate Index both decreasing by 2.2%.

Gold stocks suffered due to a continued pullback in gold prices, causing the NYSE Arca Gold Bugs Index to slump by 2.2%. Additionally, airline, banking, and biotechnology stocks were under pressure, moving lower along with most other major sectors.

**Other Markets**

In overseas markets, the Asia-Pacific region delivered mixed results. Japan's Nikkei 225 Index rose by 1.3%, while China's Shanghai Composite Index fell by 1.3%. In Europe, major markets also ended the day mixed after early gains. The U.K.'s FTSE 100 Index decreased by 0.4%, whereas Germany's DAX Index and France's CAC 40 Index both posted slight gains of 0.1%.

In the bond market, treasuries continued their downward trend, with the yield on the benchmark ten-year note rising 4.1 basis points to 4.475%.

**Looking Ahead**

Friday's trading may be influenced by the reaction to a report on durable goods orders, as well as a revised measurement of consumer sentiment.