Major stock indexes took a body blow Tuesday as wary investors pushed stocks into a massive sell-off on the heels of discouraging manufacturing data. Among the big losers was Magnificent Seven darling Nvidia, which declined more than 9% and led the sell-off in tech and chip stocks on the stock market today.
The Dow Jones Industrial Average fell 1.5%, losing 626 points in the process. The blue-chip index retreated sharply after closing at an all-time high Friday. The S&P 500 dropped 2.1%, or 119 points.
Dragged down by Nvidia, the Nasdaq's losses were harshest among the major indexes. The tech-heavy composite plummeted 3.3%, or 577 points, falling back well below its 50-day moving average. In small-cap stocks, the Russell 2000 posted a 3.2% loss.
Volume was higher on the Nasdaq and the New York Stock Exchange vs. the same time Friday. On the Nasdaq exchange, falling stocks topped rising issues by nearly 4-to-1. And on the New York Stock Exchange, losers beat gainers 3-to-1.
In the bond market, the 10-year Treasury yield fell seven basis points to 3.84%. U.S. crude oil fell 4.4% to $70.33 a barrel, as economy-sensitive assets weakened.
Nvidia Leads Market's Plunge
Nvidia lost 9.5% on the stock market today, as the artificial intelligence chip leader gave back Friday's 1.5% gain and a lot more, falling well below its 50-day line. Shares lost 7.7% last week.
After Friday's close, Nvidia formed a handle, giving it a lower buy point of 131.26, but the stock now sits about 15% below the entry and is flashing a sell signal.
Nvidia lost nearly $280 billion in market capitalization by Tuesday afternoon and was on pace for its largest one-day market cap drop ever recorded, according to Dow Jones Market Data.
3:41 p.m. ET
Manufacturing Data Comes Up Short
Spurring the market tumble was the final August Purchasing Managers' Manufacturing Index, or PMI, from S&P Global. The reading came in at 47.9 vs. estimates for 48.0.
But it also was substantially down from the 49.6 reading in July. The decrease marks the first drop in seven months as demand has started to wane, S&P Global said.
Also, the August Institute for Supply Management Manufacturing Index fell short of views. It rose to 47.2 vs. the 47.5 expected, but remained above July's 46.8.
Further, chip stocks fell on reports that China's factory activity contracted for a fourth straight month, indicating the country may have a hard time meeting its economic growth goals, according to Bloomberg. In addition, the Semiconductor Industry Association on Tuesday reported below-seasonal chip sales for the month of July.
Chip stocks hardest hit included Advanced Micro Devices with its 7.6% drop, Broadcom's 6% loss and Marvell Technology, which had a 8% decline.
Vaxcyte soared more than 37% in enormous volume after the vaccine maker reported positive news on an early-stage trial of its experimental pneumococcal disease vaccine. Shares are extended from a cup-with-handle base with a 76 buy point. The stock reached an all-time high on the stock market today.
2:15 p.m. ET
Stock Market Today: Ventilation Name Triggers Sell Rule
In other stock news, Comfort Systems plummeted nearly 11% and stumbled below its 50-day moving average. Shares gave back an 8% gain from the 352.46 buy point and triggered the 7% sell rule. A member of Investor's Business Daily's IBD 50 group of stocks, the heating and air conditioning company is coming off a record high set on Friday.
Vistra dropped more than 10% and was the biggest loser on the S&P 500 Tuesday. The electricity provider sliced through its 50-day, according to MarketSurge. Shares had been improving off the lows of a double-bottom base with a 96 buy point before today's sell-off.
Molson Coors trimmed larger gains to around 4.5% in heavy volume on news it completed the sale of several of its craft brews to Tilray Brands. Despite the strong action, the stock remains below its 200-day moving average and has lost 8% so far this year.
Tilray stock traded 2.3% lower on the stock market today, increasing its loss to 27% so far in 2024.
Sectors taking it on the chin Tuesday centered mostly around economically sensitive industrial groups. Hardest hit was the mining-metals ores group, down 6%. That was followed by oil and gas-machinery, steel and alloys, industrial machinery and energy — all down more than 5%.
But as evidenced by Nvidia, chipmakers also plunged. The Philadelphia Stock Exchange Semiconductor Index cratered nearly 8%.
12:14 p.m. ET
Pet Food Stock Rises And Bucks Trend
Freshpet bucked Tuesday's selling and advanced 3.8%, moving back into the buy zone of a cuplike base with a 136.35 buy point. The IBD 50 stock's buy range reaches to 143.17. Freshpet is Tuesday's IBD Stock of the Day.
Freeport-McMoRan crumbled 6.6% in sympathy with a drop in copper prices. The copper and gold miner is on track for its largest decrease since March 15, 2023, when it fell 6.7%, according to Dow Jones Market Data. The stock was a big loser on the S&P 500 Tuesday.
Also acting weak was the SPDR S&P Metals & Mining exchange traded fund. The fund skidded 5.5% on the stock market today and is on pace for largest decrease since March 15, 2023, when it fell 5.9%.
Aon forged higher 1.3% and reached the 347.37 buy point of a long base. The stock has rallied since the company reported mixed second-quarter results on July 26.
10:38 a.m. ET
Tesla, TG Therapeutics Buck The Tide
Tesla moved 2% higher. Tesla announced its August China sales increased 17% vs. July and 3% from August 2023. Tesla shares have lost around 14% so far this year but are forming a base.
IBD 50 stock TG Therapeutics trimmed morning gains to 1.6% but remains barely extended from a 22.67 buy point. The autoimmune treatment maker reached a 52-week high in heavy trading on the stock market today before fading.
Market Breaks Expectations On Record Nvidia Sell-Off
Stock Market Today: Dow Component Boeing Slides
Dow Jones stock Boeing tumbled around 8% after Wells Fargo downgraded the stock to underweight from equal weight and cut its price target to 119 from 185. Shares fell further below the 200-day moving average on the stock market today.
Boeing stock is on track to close at its lowest price since Nov. 4, 2022, when it closed at $160.01, according to Dow Jones Market Data. The aerospace and defense stock was the biggest loser on the Dow Jones industrials Tuesday and has lost 37% so far this year.
Novartis slid 1.5% after Jefferies downgraded the stock to hold from buy and lowered its target to 105 from 110. Shares reached a record high on Friday. The stock is extended from a cup-with-handle base with a 103.55 buy point.
NetApp reversed lower 0.4% on the stock market today. Loop Capital upgraded the stock to buy from hold and raised its price target to 150 from 121. Shares plunged 9.6% in heavy volume Thursday despite the company's higher-than-expected fiscal first-quarter adjusted earnings and net revenue results.
The data storage stock is in a cup-with-handle base with a 134.37 buy point, although the stock remains below the 50-day moving average.
Follow Kimberley Koenig for more stock market news on X/Twitter @IBD_KKoenig.
