Stock Market Today: Chip Stocks Have Their Worst Day Since June as Most Stocks Rise
The Nasdaq fell 2.60% and the chip index 6.72% on Thursday as worries about paying for AI returned, yet 337 of the 503 S&P 500 stocks rose as money ran to staples and bonds.
AI stocks sank on Thursday, while most of the rest of the market rose. Chip stocks had their worst day since June as investors fretted about how the AI build-out gets paid for, Reuters and AP reported, after Meta showed it is burning cash and Lam Research warned that chip factories are short of space. The S&P 500 fell 1.21% to 7,663.43 and the Nasdaq Composite 2.60% to 26,008.86, its worst day since 5 June, while the Dow Jones Industrial Average edged up 0.02% to 52,867.98.
Only the AI corner fell
The PHLX Semiconductor index, which tracks 30 big chip companies, sank 6.72%, its worst day since 23 June. Yet 337 of the 503 stocks in the S&P 500 rose, by our count. The index is weighted by company size, so a few AI giants can outweigh hundreds of smaller companies; an equal-weight S&P 500 fund, which gives every company the same say, rose 0.73%.
Nvidia (NVDA) slid 4.4%, its worst day since August and the biggest drag on the S&P 500. Chief Executive Jensen Huang told CNBC that the growth of neoclouds, companies that buy Nvidia chips and rent them out, is limited because “there’s a scarcity of capital.” CoreWeave (CRWV), one of those neoclouds, plunged 10.1%, and AP said it “has been particularly shaky in recent weeks because of worries about its debt.”
Meta and Lam set the tone
Meta (META) slid 7.0% after spending $34.91 billion on data centers and equipment in the quarter, more than its operations brought in, and creating a new class of nonvoting shares it could sell to raise money.
Lam Research (LRCX) plunged 11.8% after saying short supplies of clean-room space and parts will keep limiting chipmakers into 2027. KLA (KLAC) lost 9.5% and Applied Materials (AMAT) 8.2%.
Moderna’s results came out too soon
Moderna (MRNA) plunged 17.6% after Phase 3 results for its melanoma vaccine with Merck appeared online two days early. The vaccine cut the risk of the cancer returning or death by 42%, below the 49% an earlier, smaller study in different patients showed. Full results come on Saturday at the ESMO cancer congress.
Where the money went
The biggest hiding place was US government bonds. The 10-year Treasury yield fell to about 4.95% from 5.15%, its first close below 5% since 22 September. Going by the funds that track each sector, consumer staples, makers of everyday goods, were the best S&P 500 sector, up 3.3%, while technology was the worst, down 3.3%.
Procter & Gamble (PG) jumped 5.6%, its best day since March 2020, Benzinga reported, after it beat sales and profit forecasts. Lockheed Martin (LMT) jumped 7.0% after beating forecasts and raising its outlook, and Blackstone (BX) soared 8.4% after its results. Spotify (SPOT) soared 11.1% on a profit forecast above estimates.
Oil climbed too. Brent crude, the global benchmark, rose 4% to settle at $113.17 a barrel, its highest in five months, AP reported. Houthi attacks in Saudi Arabia stoked supply fears, Reuters reported, a day after The New York Times reported that the US and Israel have drawn up plans for renewed strikes on Iran after the 3 November midterms. Gold futures fell 2.6%.
The numbers
| Market | Close | Change |
|---|---|---|
| S&P 500 | 7,663.43 | -1.21% |
| Nasdaq Composite | 26,008.86 | -2.60% |
| Dow Jones Industrial Average | 52,867.98 | +0.02% |
| Russell 2000 | 2,784.03 | +0.11% |
| PHLX Semiconductor index | 10,731.98 | -6.72% |
| 10-year Treasury yield | 4.95% | -0.19 point |
| Oil (WTI, December contract) | $99.47 | +2.4% |
| Bitcoin (4:30 p.m. ET) | about $81,300 | about -3% |
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Mostly Markets is for information and education only and isn't investment advice. Nora Whitfield is a pen name. Prices are from Nasdaq and CNBC as of the time stated.
