The Ultimate Guide to Wednesday's Stock Market: Nvidia Surge Leads Tech Sector Higher, Inflation Data Affect Fed Rate Cut Bets
In today's session, US stocks managed to cut losses thanks to a Nvidia-led rally, offsetting concerns about a potential smaller Federal Reserve interest rate cut. The benchmark index gained 0.5%, with the tech-heavy index rising 1.4%, while the 30-stock index fell slightly by 0.02%.
Nvidia Corporation saw a significant surge of over 6% after reports suggested the US government might lift a ban on exporting advanced chips to Saudi Arabia. This surge in Nvidia's stock pushed other chipmakers and the broader tech sector higher.
On the other hand, the release of inflation data showed that while headline US consumer prices rose by 0.2% in August, the core figure accelerated slightly. This development could impact the Federal Reserve's decision on interest rates at its upcoming meeting. The odds of a 50 basis point cut fell to 16%, with the market now expecting a 25bps cut.
In the political arena, a fiery debate between Donald Trump and Kamala Harris offered few policy details on key economic issues. Trump's defense of high tariffs on foreign goods and Harris's criticism of the policy led to a shift in betting odds, favoring Harris in the immediate aftermath of the debate.
Furthermore, Bank of America Corp fell 1% after Warren Buffett's Berkshire Hathaway sold more shares of the bank, reducing its stake to 11%. GameStop Corp also experienced a decline of over 15% following a 31% slump in revenue.
In conclusion, the stock market's performance today was influenced by a mix of corporate developments, economic data, and political events. Investors should closely monitor these factors to make informed decisions about their portfolios.