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Stock Market News: Nasdaq Composite Flat as NVIDIA (NVDA) Rebounds

Eric Bleeker

Published: December 18, 2024 11:27 am

Live Updates

As of 10:35 a.m. ET, markets are slightly in the green this morning. Checking in on major indexes:

• Nasdaq: +29.91 (+.15%) 
• S&P 500: +13.69 (+.23%) 
• Dow Jones Industrial Average: +215.43 (+.50%) 

The big news most financial media is focusing on today is whether the Dow Jones can break its 9-day losing streak that’s the longest since the 1970s. It’s important to note that while the Dow has been down this many days in a row, it’s down less than 4% across that span. So while the losing streak is an impressive number of days, the total size of the Dow’s drop isn’t especially notable. 

Whether the Dow breaks the streak will likely depend on comments later today from Federal Reserve Chair Jerome Powell. Let’s dive deeper into today’s largest stories. 

Federal Reserve Decision Incoming 

The big news that will drive markets today is commentary from Federal Reserve Chair Jerome Powell. The Fed is widely expected to cut rates by .25%, or 25 basis points. If the Fed were to not cut rates, it’s likely the market would see an immediate and severe drop. 

However, if the Fed does cut rates, a reaction will largely depend on commentary around future outlook. There are two main areas the market will focus on: the first is Jerome Powell’s press conference and the second is a Summary of Economic Projections that gives further insight into what the Fed is planning in the year to come. 

If Powell indicates the Fed will be more cautious in the year ahead, stocks will likely drop. The Fed’s decision is released at 2:00 p.m. with Powell’s press conference to follow. 

NVIDIA Rebounds After Losing Streak 

Shares of NVIDIA (Nasdaq: NVDA) have been selling off in recent weeks. The company reached $152.89 in November, but closed yesterday trading for $130.39. Why is NVIDIA falling? 

There are a number of possible reasons. First, there has been concern that ‘scaling laws’ around pretraining data for artificial intelligence are weakening. Over the long-term, this could lead to changes in the amount of artificial intelligence spend or change what types of chips are most in demand. For example, while NVIDIA’s stock has been falling, the stocks of rivals like Broadcom (Nasdaq: AVGO) and Marvell (Nasdaq: MRVL) have been surging. 

Both stocks build custom chips that could see more benefits if artificial intelligence computing needs shift to areas like ‘inference.’ It’s unclear why NVIDIA is rallying today, but shares are rallying today. Wall Street bank Citi reiterated a $175 price target while reiterating that NVIDIA and Broadcom can coexist and that increasing capacity of CoWos from Taiwan Semiconductor should alleviate future bottlenecks of NVIDIA’s chips. 

NVIDIA shares are up 3.6% in morning trading.