The U.S. stocks have shed some of their gains on Wednesday after a strong start to the week. The pullback was heavily influenced by the decline in tech stocks ahead of the highly-awaited release of chipmaker Nvidia’s earnings.
After closing at a record high in back-to-back days, the Dow Jones Industrial Average slipped by 0.39% or 159.08 points to close at 41,091.42. The drop was led by Nike, which saw its stock slide close to 3%, as well as Intel and Salesforce.
The benchmark S&P 500 dropped by 1.1% at one point on Wednesday before regaining some of the losses to close at 5,592.18. It ended the day with a 0.60% or 33.62 loss.
Tech-heavy Nasdaq Composite was hit the most, going down by 1.12% or 198.79 en route to 17,556.03 points close. Nasdaq’s top loser for the day was online marketplace Pinduoduo, whose shares went down by 4.09%.
Investors are likely waiting to see whether the recent rally of tech stock, boosted by artificial intelligence, is sustainable and expect Nvidia’s earnings to give them answers. The chipmaker reported its earnings after the bell, beating the expectations of analysts but still seeing its stock drop by 7%.
Additionally, the personal consumption and expenditures (PCE) report for July is due to come on Friday. PCE price index is used as a preferable measurement of inflation by the Federal Reserve and could influence the Fed’s decision on anticipated rate cuts in September.