US stocks stumble to start September with another day of AI names dumped |
The global selloff in long-term government bonds weighed on risk assets on Tuesday, accentuating the pullback in the AI trade seen in the final trading day of August. However, stocks did manage to close at session highs after facing steep losses during the morning.
The S&P 500 ended down 0.7%, the Nasdaq 100 gave back 0.8%, and the Russell 2000 fell 0.6%. A Morgan Stanley basket of AI tech beneficiaries is down 5.5% over the past two sessions, its worst two-day drubbing since the sessions immediately following “Liberation Day” on April 2, when the extent of US President Donald Trump’s reciprocal tariff regime was unveiled.
Energy and health care were the only two S&P 500 sector ETFs to eke out gains, while tech was unsurprisingly at the bottom of the leaderboard.
The day’s bright spots were led by Ulta, which surged 8.1% as traders piled into the stock after the beauty retailer posted strong Q2 earnings on Friday. Kraft Heinz shares led declines, sinking 7% after the ketchup maker said it planned to split into two separate companies. |
- Nvidia dropped 2% amid a broad pullback in the AI trade as the chip giant’s newsroom pushed back on what it called “erroneous chatter in the media.”
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CoreWeave sank 9.4% as its top shareholder, along with several executives, continued to take profits now that they’re finally allowed to sell.
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Lucid shares fell 10.8%, hitting an all-time low on the first day that the luxury EV maker’s 1-for-10 reverse stock split took effect.
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Constellation Brands dropped 6.6% after the beer giant slashed its full-year guidance, as the Modelo and Corona maker braces for softer sales.
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Canopy Growth fell 17.5% after the cannabis company filed for a $200 million equity offering on Friday, a move that would dilute existing shares and could put downward pressure on the stock.
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Paramount Skydance dipped 1.6% after the production powerhouse announced a deal with Microsoft’s Activision to create a live-action Call of Duty film.
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PepsiCo shares jumped as much as 5.9% before closing up 1.1% after The Wall Street Journal reported that Elliott Investment Management has taken an activist position of roughly $4 billion in the company.
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Nio rose 3.4% even as the Chinese EV company (and Tesla rival) posted a deeper net loss and lower revenue than Wall Street expected for the second quarter.
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Frontier shares flew 14.5% after Deutsche Bank upgraded the stock to “buy” from “hold” following Friday’s news that rival Spirit Airlines had filed for its second bankruptcy in a year.
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— Luke Kawa, Markets Editor & Nia Warfield, Markets Writer |
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The hyperscalers writing the checks for AI datacenters were the heaviest weight on stocks Tuesday, but others hitched to the investment boom fell too. Read more. |
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The current market is a Rorschach test; do you see a golden age of corporate profitability ushered in by AI, or irrational exuberance gone mad? Read more. |
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(Greg Baker/Getty Images) |
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Momentum works to the downside too
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Google’s Waymo now has 2,000 autonomous cars in service, while Tesla has about 30
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Paramount and Microsoft’s Activision agree to partner on a “Call of Duty” movie
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McDonald’s is bringing the value back to value meals — but Wall Street is watching
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OpenAI announces plan for flagging mental health crises and adding teen controls
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- Metaplanet raising $3.7 billion to buy bitcoin
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There are now more ETFs than stocks in the US, and many of them aren’t vanilla
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Ethereum treasury companies swell as spot ETFs notch fifth straight month of positive inflows
The network’s monthly on-chain volume has climbed to a four-year high, jumping past $346 billion in August. -
ChatGPT use is picking up again, just as students head back to school
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