Stocks Finish Mostly Lower as Nvidia Weighs on Chipmakers

The S&P 500 Index ($SPX) (SPY) on Thursday closed down -0.54%, the Dow Jones Industrial Average ($DOWI) (DIA) closed up +0.03%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -1.16%.  March E-mini S&P futures (ESH26) fell -0.56%, and March E-mini Nasdaq futures (NQH26) fell -1.22%.

Stock indexes settled mostly lower on Thursday, although the Dow Jones Industrials posted a 1-week high.  The broader market was under pressure on Thursday as Nvidia’s earnings failed to alleviate concerns about an overheated AI economy, which weighed on chipmakers and AI-infrastructure stocks.  Although Nvidia easily beat Q4 earnings estimates and forecast a Q1 outlook above expectations, the stock closed down more than -5% amid uncertainty over China, and it will continue to exclude data center revenue from China in its forecasts due to concerns about Chinese government approval. 

Stocks recovered from their worst levels on Thursday amid signs of progress in US nuclear negotiations with Iran.  The foreign minister of Oman, who is mediating the nuclear discussions between the US and Iran, said the US and Iran will continue nuclear talks at a technical level next week after making "significant progress" in Switzerland. 

Also on the positive side, Salesforce rallied more than +4% to lead software stocks higher and keep the Dow Jones Industrials in positive territory after it gave a strong outlook for long-term sales and announced a large share buyback, calming fears about AI disruption in the software industry.

Stocks found support on Thursday from the smaller-than-expected increase in US weekly jobless claims, a sign of labor market strength.  US weekly initial unemployment claims rose by +4,000 to 212,000, showing a stronger labor market than expectations of 216,000.

Upbeat comments on Thursday from Chicago Fed President Alan Goolsbee were supportive for stocks, as he said the US economy has been solid and the job market has been stable, and that interest rates can come down more this year if inflation does.

Geopolitical risks remain a negative for stocks.  Tuesday evening, President Trump said Iranian officials are "again pursuing their sinister nuclear ambitions," boosting speculation that the US may be preparing a military strike on Iran in the coming days.  Last Friday, President Trump said that he’s considering a limited military strike on Iran to ramp up pressure on the country to strike a deal over its nuclear program and gave them a March 1-6 deadline for an agreement over the country’s nuclear activities, and has threatened military strikes if it fails to comply.

In Tuesday night's State of the Union address, President Trump doubled down on his commitment to tariffs.  President Trump’s new 10% global tariffs went into effect on Tuesday after the Supreme Court struck down his global “reciprocal” tariffs last Friday. Mr. Trump subsequently threatened to raise the global tariff rate to 15%, and an administration official said the White House is working on a formal order to implement that higher rate, but the timeline for its implementation has not been finalized.  Mr. Trump is applying the 10% baseline levy under Section 122 of the 1974 Trade Act, which allows the president to impose the charge for 150 days without congressional approval. 

The market’s focus this week will be on corporate earnings results and economic news.  On Friday, the Feb MNI Chicago PMI is expected to slip -1.8 to 52.2. 

Q4 earnings season is nearing its end, with more than 90% of the S&P 500 companies having reported earnings results.  Earnings have been a positive factor for stocks, with 74% of the 472 S&P 500 companies that have reported beating expectations.  According to Bloomberg Intelligence, S&P earnings growth is expected to climb by +8.4% in Q4, marking the tenth consecutive quarter of year-over-year growth.  Excluding the Magnificent Seven megacap technology stocks, Q4 earnings are expected to increase by +4.6%.

The markets are discounting a 3% chance for a -25 bp rate cut at the next policy meeting on March 17-18.

Overseas stock markets settled mixed on Thursday.  The Euro Stoxx 50 fell from a new record high and closed down -0.19%.  China’s Shanghai Composite closed down -0.01%.  Japan’s Nikkei Stock 225 climbed to a new all-time high and closed up +0.29%.

Interest Rates

March 10-year T-notes (ZNH6) on Thursday closed up +8 ticks.  The 10-year T-note yield fell -3.6 bp to 4.016%.  Mar T-notes rallied to a 2.75-month high on Thursday, and the 10-year T-note yield fell to a 2.75-month low of 4.012%.  Thursday’s stock market slump spurred safe-haven demand for T-notes.  Also, comments from Chicago Fed President Alan Goolsbee were bullish for T-notes, as he said interest rates could come down further this year if inflation does. 

Limiting gains in T-notes on Thursday were the smaller-than-expected increase in weekly US jobless claims, a hawkish factor for Fed policy.  Also, mediocre demand for the Treasury’s $44 billion auction of 7-year T-notes was negative for T-note prices as the auction had a bid-to-cover ratio of 2.50, below the 10-auction average of 2.53. 

European government bond yields moved lower on Thursday.  The 10-year German bund yield dropped to a 2-75-month low of 2.683% and finished down -1.7 bp to 2.691%.  The 10-year UK gilt yield tumbled to a 14.5-month low of 4.271% and finished down -4.3 bp to 4.274%.

The Eurozone Feb economic confidence indicator unexpectedly fell -1.0 to 98.3, weaker than expectations of an increase to 99.8.

Eurozone Jan M3 money supply rose +3.3% y/y, stronger than expectations of +2.9% y/y and the largest increase in 6 months.

Swaps are discounting a 3% chance of a -25 bp rate cut by the ECB at its next policy meeting on March 19.

US Stock Movers

AI-infrastructure stocks and chipmakers retreated on Thursday after Nvidia’s earnings results failed to quell investor concerns about the disruptive risk of artificial intelligence.  Nvidia (NVDA) closed down more than -5% to lead losers in the Nasdaq 100 and Dow Jones Industrials despite reporting Q4 data center revenue of $62.3 billion, stronger than the consensus of $60.36 billion, as the results failed to quell investor concerns surrounding demand durability.  Also, Applied Materials (AMAT), Lam Research (LRCX), and ASML Holding NV (ASML) closed down more than -4%, and Advanced Micro Devices (AMD), Broadcom (AVGO), Micron Technology (MU), Western Digital (WDC), and Seagate Technology Holdings (STX) closed down more than -3%.  In addition, Intel(INTC) and Marvell Technology (MRVL) closed down more than -2%.

Software stocks moved higher on Thursday, a supportive factor for the broader market.  Atlassian (TEAM) closed up more than +8%, and Datadog (DDOG) closed up more than +5%.  Also, CrowdStrike (CRWD) and ServiceNow (NOW) closed up more than +4%, and Salesforce (CRM) closed up more than +4% to lead gainers in the Dow Jones Industrials after reporting Q4 revenue of $11.20 billion, above the consensus of $11.17 billion, and forecasting Q1 revenue of $11.03 billion to $11.08 billion, stronger than the consensus of $10.99 billion.  In addition, Autodesk (ADSK) and Intuit (INTU) closed up more than +3%.

PROCEPT BioRobotics (PRCT) closed down more than -15% after forecasting full-year revenue of $300 million to $410 million, weaker than the consensus of $422.1 million. 

Chemed Corp (CHE) closed down more than -14% after reporting Q4 adjusted EPS of $6.42, well below the consensus of $7.03. 

Universal Health Services (UHS) closed down more than -11% to lead losers in the S&P 500 after reporting Q4 net revenue of $4.49 billion, weaker than the consensus of $4.51 billion.

Donaldson (DCI) closed down more than -11% after reporting Q2 adjusted EPS of 83 cents, below the consensus of 89 cents, and cutting its full-year adjusted EPS to $3.93-$4.01 from a previous forecast of $3.95-$4.11, weaker than the consensus of $4.05. 

Pure Storage (PSTG) closed down more than -10% after the company gave an outlook that TD Cowen said points to decelerating growth. 

Synopsys (SNPS) closed down more than -5% after forecasting full-year free cash flow of $1.90 billion, below the consensus of $1.94 billion. 

Trade Desk (TTD) closed down more than -4% after forecasting Q1 revenue of $678 million, below the consensus of $688.8 million.

Chime Financial (CHYM) closed up more than +13% after reporting Q4 revenue of $596.4 million, stronger than the consensus of $578.3 million, and forecasting full-year revenue of $2.63 billion to $2.67 billion, better than the consensus of $2.60 billion.

Paramount Skydance (PSKY) closed up more than +10% to lead gainers in the S&P 500 after reporting Q4 revenue of $8.15 billion, above the consensus of $8.12 billion. 

J M Smucker (SJM) closed up more than +8% after it said two new directors will be joining the board as part of an agreement reached with activist investor Elliot Investment Management. 

TKO Group Holdings (TKO) closed up more than +8% after forecasting 2026 adjusted Ebitda of $2.24 to $2.29, the midpoint above the consensus of $2.25.

Celsius Holdings (CELH) closed up more than +7% after reporting Q4 sales of $721.6 million, well above the consensus of $639 million. 

Fair Isaac Corp (FICO) closed up more than +6% after announcing a new $1.5 billion stock buyback program.

Janus Henderson Group Plc (JHG) closed up more than +6% after Victory Capital offered to buy the company for $57.04 a share. 

Earnings Reports(2/27/2026)

CubeSmart (CUBE) and NIQ Global Intelligence Plc (NIQ).