U.S. Stocks Close Mostly Lower Amid Tech Sector Weakness

(RTTNews) - Stocks fluctuated over the course of the trading session on Wednesday before eventually ending the day mostly lower. The Nasdaq and the S&P 500 extended their losing streaks to four days, falling to their lowest closing levels in nearly two months.

The major averages all finished the day red, although the Dow posted a relatively modest loss, edging down 45.66 points or 0.1 percent to 37,753.31. The S&P 500 slid 29.20 points or 0.6 percent to 5,022.21 and the Nasdaq tumbled 181.88 points or 1.2 percent to 15,683.37.

Weakness among technology stocks weighed on the markets, as reflected by the notable slump by the tech-heavy Nasdaq.

Shares of Nvidia (NVDA) came under pressure as the day progressed, with the AI darling plunging by 3.9 percent to its lowest closing level in well a month.

The drop by Nvidia came as semiconductor stocks broadly came under pressure following disappointing first quarter sales by Dutch chip equipment maker ASML (ASML).

Reflecting the weakness in the sector, the Philadelphia Semiconductor Index dove by 3.3 percent to a nearly two-month closing low.

The lower close on Wall Street also came amid ongoing concerns about the outlook for interest rates following Tuesday's remarks by Federal Reserve Chair Jerome Powell.

During a moderated discussion with Bank of Canada Governor Tiff Macklem, Powell suggested rates are likely to remain higher for longer amid a "lack of progress" toward reaching the central bank's inflation goal.

The Fed chief's remarks came as recent data showing sticky inflation along with continued economic strength have led to reduced expectations of a rate cut in June.

According to CME Group's FedWatch Tool, the chances of a 25 basis point rate cut in June have tumbled to 16.4 percent compared to 55.2 percent just a week ago.

Airline stocks bucked the downtrend, however, with the NYSE Arca Airline Index soaring by 3.8 percent after ending Tuesday's session at a two-month closing low.

United Airlines (UAL) led the sector higher, skyrocketing by 17.5 percent reporting a much narrower than expected first quarter loss.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Wednesday. Japan's Nikkei 225 Index slumped by 1.3 percent, while China's Shanghai Composite Index surged by 2.1 percent.

Meanwhile, European stocks gave back ground after an early rally but still closed mostly higher. While the French CAC 40 Index climbed by 0.6 percent, the U.K.'s FTSE 100 Index rose by 0.4 percent and the German DAX Index close just above the unchanged line.

In the bond market, treasuries showed a strong move back to the upside after moving sharply lower over the two previous sessions. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, slid 7.4 basis points to 4.585 percent.

Looking Ahead

Trading on Thursday may be impacted by reaction to the latest U.S. economic data, including reports on weekly jobless claims, existing home sales and Philadelphia-area manufacturing activity.