Stock Market Today: Nasdaq Slips as Magnificent 7 Stocks Drop
The Dow Jones Industrial Average, on the other hand, gained ground Friday as Salesforce bounced back.
![closeup of blue stock chart with red and green volume bars and a green moving average](https://cdn.mos.cms.futurecdn.net/hbRMDVRhfJobMQLXddLEdj-415-80.jpg)
It was a mixed finish to a strong month for stocks as investors weighed an encouraging inflation update against another round of disappointing tech earnings and a selloff in several mega-cap names.
Starting with the inflation data. Ahead of the open, the Bureau of Economic Analysis said the Personal Consumption and Expenditures (PCE) Price Index, which measures consumer spending, was up 0.3% from March to April, matching what was seen the month prior and arriving in line with economists' predictions. The annual increase in the PCE index was also unchanged at 2.7%.
Core PCE, which excludes volatile food and energy costs, ticked lower on a monthly basis in April, to 0.2% from March's 0.3%, while the year-over-year increase stayed the same. The data also showed consumer spending rose at a lower-than-expected 0.2% monthly rate in April, while personal incomes rose 0.3%.
![https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-200-80.png](https://cdn.mos.cms.futurecdn.net/hwgJ7osrMtUWhk5koeVme7-320-80.png)
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
"The PCE Price Index didn't show much progress on inflation, but it didn't show any backsliding either, " says Chris Larkin, managing director of trading and investing at E*TRADE from Morgan Stanley.
September rate-cut odds edge up after PCE report
Still, investors will have to remain patient, Larkin adds. "The Fed has suggested it will take more than one month of favorable data to confirm inflation is reliably moving lower again, so there's still no reason to think a first rate cut will come any earlier than September," he notes.
Indeed, according to CME Group's FedWatch Tool, futures traders are pricing in a strong chance the Fed will keep interest rates steady at its June (99% probability) and July (85%) meetings. The odds of a quarter-point rate cut in September are currently at 47%, up from 45% one day ago.
The inflation data helped all three indexes open higher Friday. The blue chip Dow Jones Industrial Average (+1.5% at 38,686) and broader S&P 500 (+0.8% at 5,277) held their gains through the close as Salesforce (CRM, +7.5%) bounced back from Thursday's earnings-related drubbing.
The tech-heavy Nasdaq Composite (-0.01% at 16,735), meanwhile, rallied back from a nearly 2% intraday decline but still ended in the red.
Dell, MongoDB sink after earnings
Negative earnings reactions from several tech stocks weighed on investor sentiment. Most notable was a 17.9% decline for Dell Technologies (DELL). While the PC maker beat top- and bottom-line estimates for its fiscal first quarter, its second-quarter earnings guidance came up short. The company also said it expects its gross margin rate to decline as artificial intelligence (AI) costs ramp up.
MongoDB (MDB) was another post-earnings decliner, spiraling 23.9% after its quarterly results. The database platform provider reported higher-than-expected earnings and revenue for its fiscal first quarter but lowered its full-year guidance amid weak consumption growth.
Still, Needham analyst Mike Cikos maintained a Buy rating on the tumbling tech stock. "We view MongoDB as an emerging industry leader with strong products attacking a large market opportunity," Cikos says. And while the analyst admits that the market will need time to digest the MDB's disappointing guidance and consumption outlook, he expects growth to reaccelerate next year.
A selloff in several Magnificent 7 stocks amplified headwinds for the broad market for most of Friday too. Amazon.com (AMZN, -1.6%) created the biggest drag. And while Nvidia (NVDA) fell 0.8%, it finished the month up 27% thanks to last week's blowout earnings report.
Related content
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
With over a decade of experience writing about the stock market, Karee Venema is the senior investing editor at Kiplinger.com. She joined the publication in April 2021 after 10 years of working as an investing writer and columnist at Schaeffer's Investment Research. In her previous role, Karee focused primarily on options trading, as well as technical, fundamental and sentiment analysis.
-
Eight Key Steps to Take When Investing in the Stock Market
The stock market can be a confusing place for beginners, but it doesn't have to be.
By Kiplinger Advisor Collective Published
-
Confused by Annuities? Making Sense of the Different Types
Many investors aren't sure if annuities are a good option for meeting financial goals. Let's look at the different categories, along with their pros and cons.
By Kris Maksimovich, AIF®, CRPC®, CPFA®, CRC® Published
-
Stock Market Today: Stocks Slip Ahead of Mega-Cap Earnings
GE Aerospace shares soared after earnings while United Parcel Service stock slumped.
By Karee Venema Published
-
Is GE Stock Still a Buy After Big Earnings Beat?
GE stock is higher Tuesday after the industrial giant's beat-and-raise quarter, but what do analysts think? We take a closer look here.
By Joey Solitro Published
-
UPS Stock Heads Toward Worst Day Ever After Earnings
UPS stock is down big after coming up short of analysts’ expectations for its second quarter and cutting its outlook. Here’s what you need to know.
By Joey Solitro Published
-
Spotify Stock Surges After Q2 Earnings Beat: What to Know
Spotify stock is flying higher Tuesday after the streaming giant reported its second-quarter earnings results. Here's what you need to know.
By Joey Solitro Published
-
Stock Market Today: Mega-Cap Tech Rallies to Drag Markets Higher
Markets focused on upcoming earnings from Magnificent 7 stocks rather than chaos in D.C.
By Dan Burrows Published
-
Stock Market Today: Stocks Tumble After Spectacular Global Internet Crash
Market participants rushed out of risk assets to end a wild week of trading.
By Dan Burrows Published
-
Stock Market Today: Dow Sinks 533 Points as Big Banks, Mega Caps Slump
Goldman Sachs and Apple were two of the worst-performing blue chip stocks on Thursday.
By Karee Venema Published
-
Paris Olympics: 5 Sports-Related Stocks Going for Gold
Tactical investors may want to keep an eye on these sports-related stocks as the countdown to the Paris Olympics begins.
By Jeff Reeves Published