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Nvidia stock reversed a three-day drop, boosting the S&P 500 and Nasdaq.
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The AI giant had seen a $430 billion wipeout days after becoming the biggest company in the world.
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The Fed’s Michelle Bowman indicated there’s still a chance rates rise if inflation isn’t contained.
An end to Nvidia’s rout brought new life to the stock market on Tuesday, sending the S&P 500 and Nasdaq churning higher in the session.
The AI chip darling gained nearly 7%, reversing a decline that cost it $431 billion in market capitalization in a matter of days. Given a lack of fundamental drivers, analysts have explained the sell-off as profit taking following a monster rally so far in 2024.
Other mega-cap tech leaders also recovered alongside Nvidia, with Amazon, Meta, and Google all up in Tuesday trades.
Meanwhile, the latest consumer confidence report eased on Tuesday, although its subcategories showed improvement.
“The job market is key to future consumer spending. Although consumers became a bit more cautious about the future, they feel pretty good about the present situation. Inflation expectations improved, incomes seem stable, and consumers feel good about the job market,” LPL Financial chief economist Jeffrey Roach said.
Investors are keeping watch for Friday’s personal consumption expenditures release, which will help determine US inflation and future monetary policy. So far, the Federal Reserve is tilting towards a hawkish stance, after Fed Governor Michelle Bowman indicated chances of another rate hike.
“I remain willing to raise the target range for the federal funds rate at a future meeting should progress on inflation stall or even reverse,” she said on Tuesday.
Here’s where US indexes stood at the 4:00 p.m. closing bell on Tuesday:
Here’s what else happened today:
In commodities, bonds, and crypto:
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West Texas Intermediate crude oil shed 0.95% to $80.76 a barrel. Brent crude, the international benchmark, dropped 2.1% to $84.97 a barrel.
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Gold decreased by 0.42% to $2,323.60 per ounce.
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The 10-year Treasury edged lower by one basis point to 4.23%.
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Bitcoin gained 2.7% to $61,993.
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