Nvidia Drops Almost 5% Ahead of Inflation Report

It was also a bad day for Lyft, WeWork, Tesla
By Newser Editors and Wire Services
Posted Aug 9, 2023 3:51 PM CDT
Tech Stocks Drop Ahead of Inflation Report
Traders work on the floor at the New York Stock Exchange.   (AP Photo/Seth Wenig)

Stocks slipped Wednesday, as Wall Street braced for a highly anticipated report on inflation. The S&P 500 fell 31.67 points, or 0.7%, to 4,467.71 Wednesday and has now dropped six of the last seven days. The Dow Jones Industrial Average fell 191.13 points, or 0.5%, to 35,123.36 after flipping between gains and losses through the day. The Nasdaq composite fell 162.31 points, or 1.2%, to 13,722.02 as Big Tech stocks led the declines . On Thursday, the US government will give the latest monthly update on inflation that consumers are feeling across the country, and economists expect to see an acceleration to 3.3% in July from 3% in June.

A reading on Thursday that's much worse than expected could raise fears that the Fed's job in battling inflation is far from done and that it may have to keep hiking interest rates. At the least, it could push the Fed to keep rates high for longer than expected, the AP reports. Axon Enterprise, the company behind Tasers and Axon body cameras, jumped 14.1% for the biggest gain in the S&P 500. It reported much stronger profit for the spring than analysts expected. Akamai Technologies also helped to lead the market after beating forecasts for both profit and revenue. Its stock rose 8.5%.

Outside of earnings, Penn Entertainment jumped 9.1% after the company said it's paying $1.5 billion for the exclusive rights to re-brand its sports-betting app with the ESPN name. On the losing end of Wall Street was Lyft, which skidded 10%. The ride-share company reported better results for the latest quarter than expected, and its forecasts for the current quarter also topped forecasts. But analysts highlighted some cautious comments from the company for expectations for the end of the year.

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WeWork plunged 38.6% to 13 cents after saying there's substantial doubt about its ability to stay in business as it burns through cash. Nvidia was the heaviest weight on the S&P 500, falling 4.7%. The chipmaker is one of the stocks that have rocketed this year due to Wall Street's frenzy around artificial-intelligence technology, raising fears that they went too far. Other Big Tech stocks also fell, and their movements pack more punch on the S&P 500 because of their massive size. Amazon sank 1.5%, Microsoft fell 1.2% and Tesla dropped 3%. The threat of high rates tends to hit technology and other high-growth stocks the hardest. (More stock market stories.)

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