Dow gives up 700-point gain, turns negative as Nvidia fizzles, rate-cut hopes dim: Live

Stocks were well off their session highs on Thursday, as market-wide rally sparked by blockbuster Nvidia results and guidance lost steam and as investors lost hope that the Federal Reserve would cut rates again in December.

The Dow Jones Industrial Average last traded 53 points lower. The S&P 500 shed 0.1%. The Nasdaq Composite fell 0.3%. The Dow jumped as much as 717 points, while the S&P 500 and Nasdaq were up 1.9% and 2.6% at their highs, respectively.

Nvidia shares turned negative, dragging down the market with it. The stock gained as much as 5% after the chipmaker released its highly anticipated quarterly results, which beat Wall Street’s earnings and revenue expectations. The market-moving company also gave a stronger-than-expected fourth-quarter sales forecast, with CEO Jensen Huang saying demand for its current-generation Blackwell chips are “off the charts.” He also rejected the idea of an AI bubble.

But the stellar results were not enough to keep the stock or the market higher with concerns swirling about AI stock valuations, especially if the Fed doesn’t lower interest rates. Oracle and AMD were among the first AI plays to fall into the red on the session. Nvidia then followed.

A shutdown-delayed September jobs report showed the economy added 119,000 jobs, beating expectations. Following the data, the latest fed funds futures trading showed less than 40% odds that the central bank would cut for a third time this year next month.

“The Nvidia sizzle is being extinguished by the lowering probability of a December rate cut,” said Jeff Kilburg of KKM Financial. “Markets expected a December cut, the narrative has seemingly changed.”

It’s been a relatively weak month for the AI trade and markets leading up to Nvidia’s results as investors took profits on the names after such a strong year. The S&P 500 was down about 3% for the month and the tech-heavy Nasdaq was down nearly 5%, through Wednesday. Nvidia itself was down 7% for November until Thursday’s rebound.

Walmart shares rose 6% on Thursday after the retailer posted stronger-than-expected sales and revenue for its fiscal third quarter, partially due to its e-commerce business’ growth. The move in Walmart — seen as a steady stock in any economy — was partly due to a ongoing rotation out of higher-valued tech into defensive-oriented companies.

“It’s taking the market awhile to sort of digest where it wants to be positioned, with regard to the growth versus value trade and with exposure to risk versus risk-off [assets],” Thomas Martin, a senior portfolio manager at Globalt Investments, told CNBC.