Live Updates: Nasdaq Composite Drops as NVIDIA (NVDA) Rally Fades
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Live Updates
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The sell-off in stocks has moderated, with the Dow Jones now slightly positive, the S&P 500 down .35%, and the Nasdaq down .95% as of 11:30 p.m. ET.
What’s causing the sudden sell-off? Treasury rates continue to rise, which appears to be the primary catalyst in stocks with recent momentum selling off. Two key storylines to watch this year will be how much corporate earnings rebound and what happens with interest rates.
Right now, expectations are trending toward just a single rate cut this year. The continuing drop in expectations around interest rate cuts is reflected in the continuing rise in Treasury yields.
After rising strongly in premarket trading, NVIDIA shares are down 3% as of 10:22 a.m. ET.
In general, momentum stocks are falling today. The Nasdaq Composite is now down .70% while the Information Technology sector is off 1.04%.
Other stocks that have seen big gains across the past year like Palantir and Applovin are also down today. Palantir is down 5.5% while Applovin has fallen 9%.
Let’s take a look at some of the biggest market movers today.
- Micron (Nasdaq: MU): Is up 7% after NVIDIA revealed they’ll be using Micron’s memory for their new RTX lineup of graphics cards. While RTX doesn’t provide the revenue of other product lines where NVIDIA has a close relationship with memory maker SK Hynix, there have been reports that Micron is struggling with yields on cutting-edge memory chips so the stamp of approval from NVIDIA is enough to push shares higher.
- Moderna (Nasdaq: MRNA): Jumped as fears continue to grow around a bird flu pandemic. Moderna is developing a vaccine for the bird flu, so if cases continue growing it’s a likely stock ‘winner’ from a bad situation.
After jumping nearly 3% in premarket trading, NVIDIA lost its gains shortly after the bell.
The company is currently trading almost exactly flat while other AI stocks like Broadcom (Nasdaq: AVGO) and Marvell (Nasdaq: MRVL) also fell shortly after the opening bell.
It appears AI stocks may finally take a breather after a furious rally in the first three days of 2025.
Here are some of the more notable upgrades and downgrades from Wall Street today:
- Ulta Beauty (Nasdaq: ULTA): Has a series of upgrades and downgrades as the company announces a new CEO. B. Riley upgraded the stock to Neutral from Sell, Canaccord raised their price target to $538 from $500, Citi raised its price target to $457 from $450 while maintaining a Neutral rating, and Stifel raised its price target to $475 from $455 while maintaining a Hold rating. Ulta shares are up 3.65% in premarket trading.
- Axon (Nasdaq: AXON): Say its price target raised to $645 from $615 by Raymond James. Shares aren’t moving much premarket after Axon fell 5% in yesterday’s trading.
As of 9 a.m. ET, markets are largely flat in premarket trading.
- Nasdaq Futures: Up 15.25 (+.07%)
- S&P 500 Futures: +13.75 (.23%)
- Dow Jones Futures: +117.00 (+.27%)
After several days of Nasdaq Composite outperformance, in premarket the S&P 500 and Dow Jones are doing slightly better. Let’s check in on the market’s biggest stories before the bell.
NVIDIA Rallying Again
The big news in the tech world last night was NVIDIA (Nasdaq: NVDA) headlining the Consumer Electronics Show. At the keynote presentation – which you can watch here – NVIDIA CEO Jensen Huang laid out his vision for where AI is headed in 2025 and beyond. Here are a few highlights:
- NVIDIA’s consumer graphics cards are no longer the main driver of its business, but NVIDIA released an update priced far more aggressively than most anticipated. A top-of-the-line 5090 chip will cost $1,999, but gamers can now buy a brand-new RTX 5070 that’s just as powerful as NVIDIA’s prior generation 4090 for just $549. NVIDIA is also releasing an extremely competitive lineup of laptop graphics cards.
- The company announced new initiatives to build the foundation for training advanced robotics. The platform is named ‘Cosmos,’ and it will likely be something you hear about quite a bit in the years ahead.
- NVIDIA also announced a self-driving partnership with Toyota and launched a next-generation self-driving processor named ‘Thor Blackwell’ that the company says is 20X more powerful than its prior chip.
We’ve discussed how recent breakthroughs in AI models should be another accelerant to progress rather than seeing AI slow down. NVIDIA’s price continues to rally as the market grasps the significance of recent AI breakthroughs.
NVIDIA is up 2.68% in premarket trading to more than $153 per share and has now passed Apple (Nasdaq: AAPL) as the world’s most valuable company.
Trump Tariffs Continue to Be in Focus
Another market catalyst this week is a report from The Washington Post that the Trump Administration may aim for more narrow tariffs impacting a smaller group of companies.
Trump has dismissed this report, but the market has been negative on Trump’s tariff proposals, which may be impacting his thinking on the subject. The market generally sees tariffs as inflationary and fears a trade war could slow economic progress in the years ahead while creating headwinds across impacted industries.
We’ll continue monitoring this topic in future updates as more news develops.
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