Indexes sank in late afternoon trades and finished lower Wednesday after the minutes from the latest Fed meeting showed concerns over persistent inflationary pressures, with several members showing lack of confidence as the committee seeks a path toward a rate cut. Nvidia's stock climbed 2.5% in extended trading following its earnings report.
The Dow Jones Industrial Average fell 0.5% while the S&P 500 closed 0.3% lower. The Nasdaq lost 0.2% in the stock market today. All three indexes remain above their key moving averages.
Volume on the NYSE and the Nasdaq rose from Tuesday's totals, according to preliminary data. Breadth deteriorated as decliners outnumbered advancers by 5-to-2 on the NYSE and about 8-to-5 on the Nasdaq.
The small-cap Russell 2000 fell 0.8%, and the Innovator IBD 50 ETF fell 1.2%.
Nvidia fell slightly in the regular session but rose 2.5% after the close. April-quarter results beat analysts' expectations and the AI-technology company raised its guidance. Nvidia also set a 10-for-1 stock split.
The Fed minutes from the April 30-May 1 meeting showed "total and core PCE price inflation were both projected to move lower this year relative to last year, though the expected pace of disinflation was slower than in the March projection."
The minutes reveal a shift in expectations for monetary policy, with fewer than two 25-basis-point rate cuts in 2024 and a greater likelihood of "at most one such rate cut" this year.
Some policymakers, skeptical that higher rates are bringing inflation down sufficiently, said they would be willing to consider a rate increase.
The yield on the benchmark 10-year Treasury note rose nearly 2 basis points to 4.43%.
Existing-home sales in April came in lower than views, at 4.14 million versus estimates of 4.2 million, according to Econoday.
Dow Jones Stocks
Most stocks in the Dow fell in late trades, with tech leaders ending mixed. Salesforce hovered just under the 50-day moving average while Microsoft tested a buy point at 430.82.
Microsoft is expanding its artificial intelligence tools to personal computers and devices, the company said during its Build conference.
Apple ended a seven-day win streak as it fell 0.9%. Intel gave up early gains and fell 1%. Telecom Verizon Communications held on to a slight gain. Cisco Systems and Johnson & Johnson were the biggest gainers in the Dow, both up about 1%.
But consumer stocks Home Depot and Nike fell, along with diversified manufacturer 3M and plastics maker Dow Inc.. The latter pierced its 50-day moving average.
Stock Market Today
Earnings movers included retailer Target, Urban Oufitters and TJX Cos.. Target plunged 8% as results came in below views, ruining its base. But shares were below the 50-day moving average to start with.
Urban Outfitters reversed 4.6% lower even after first-quarter earnings beat views. Shares remain in a consolidation with a buy point of 47.29. TJX broke out past the 102.04 buy point of a double-bottom base but closed below that buy point.
Among sell signals after earnings, Modine Manufacturing slid below the 50-day moving average but closed back above the line, off 4.5%. The heating and air conditioning company saw sales decline and earnings growth decelerate despite an increase in demand from data centers for artificial intelligence applications.
Among chip stocks, Analog Devices posted solid results and raised its outlook. Both sales and earnings were above the midpoint of the outlook. The stock gapped up to an all-time high. Williams-Sonoma reversed sharply lower after announcing first-quarter results. Shares broke support at the 50-day moving average.
Homebuilder Toll Brothers fell below the 50-day line in heavy volume. It fell more than 7% below the 128.75 entry it cleared last week, which is a sell signal. The company, which beat profit estimates, was among the worst performers in the IBD MarketSurge Growth 250.
Hovnanian Enterprises also fell below the 50-day line in heavy volume after its second-quarter report, down 13% in heavy volume. Homebuilders as a group fell sharply, with K.B. Home, PulteGroup and Lennar seeing losses ranging between 2% and 4%.
Futures: Will Nvidia Lift AI Plays, Market Rally?
Magnificent Seven Stock Google
Among the Magnificent Seven, Google parent Alphabet is pausing after a seven-day rally.
Intuitive Surgical edged above the 403.76 buy point of a flat base but fell below that entry Wednesday.
In the IBD 50, PDD was up 01.1%. PDD shares remain in a buy zone to 149.44 after releasing earnings earlier today.
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