On a mixed trading day for US equity indexes, investors carefully considered the latest economic data amid Nvidia's ($NVDA) disappointing revenue performance, which marked the smallest earnings beat in two years. Furthermore, President Donald Trump announced plans to implement import tariffs on three of the nation's key trading partners, intensifying economic concerns. The Nasdaq Composite index fell by 0.7%, closing at 18,934, while the S&P 500 index slipped 0.1% to finish at 5,948.
In contrast, the Dow Jones Industrial Average saw a modest increase of 0.6%, reaching 43,694. Among the sectors, utilities and technology experienced the greatest declines, whereas financial services and energy showed resilience as top gainers throughout the trading session. Nvidia's fiscal Q4 results, released overnight, did surpass general analyst expectations; however, the stock still experienced a significant drop of 3.9% intraday, making it the poorest performer on the Dow.
Despite this earnings beat, analysts from Deutsche Bank noted that the results fell flat compared to the lofty expectations set by Nvidia's previous performance trends. "Indeed, it was the smallest revenue beat in two years, so that was underwhelming for investors used to much bigger upside surprises," a note from the financial institution stated.
Looking ahead, sales guidance for the upcoming quarter projected a modest increase, landing just slightly above average expectations. In economic news, the Labor Department reported an uptick in US initial jobless claims, rising to 242,000 for the week ending February 22, up from a high-revised figure of 220,000.
This number exceeded forecasts made in a survey compiled by Bloomberg, which had expected claims to hit 221,000. Additionally, the four-week moving average rose by 8,500, reaching 224,000, underscoring ongoing employment volatility. Most US Treasury yields climbed during intraday trading, with two-year Treasury yields increasing by 2.4 basis points to settle at 4.1%, while the ten-year yield rose by 4.1 basis points, reaching 4.29%. Amid these economic fluctuations, Trump confirmed that his administration would proceed with implementing import duties on both Mexico and Canada in the coming week.
China, too, would see a 10% additional tariff implemented on the same day for certain imports. Starting March 4, Mexico and Canada are subject to 25% tariffs, with China facing a 10% tariff primarily targeting energy sectors. The current economic climate reflects a concerning stagnation, compounded by rising prices—a scenario that leaves policymakers in a tough situation, as articulated by Nigel Green, CEO of deVere Group, an independent financial advisory and asset management firm.
"It limits options, fuels uncertainty, and shakes investor confidence," he remarked in a recent commentary. From the housing market, US pending home sales dropped by 4.6% in January, sharply contrasting with the anticipated drop of 0.9% expected in another Bloomberg survey, following a reported 4.1% decline in December.
The National Association of Realtors attributed this downturn to market unpredictability, with the monthly sales index falling 5.2% compared to January 2024. In the midst of these developments, the stock symbols $NVDA, $US30, and $US500 highlight the key players in this evolving market landscape..