US stocks experienced a volatile trading day on Thursday, November 21, 2024, as investors reacted to Nvidia's impressive earnings report while grappling with Alphabet's significant decline amid regulatory pressures. The Dow Jones Industrial Average surged over 450 points, reflecting strong investor sentiment in certain sectors, while the tech-heavy Nasdaq faced challenges from major players like Alphabet.
Nvidia's latest earnings report showcased the company's continued dominance in the AI chip market. The chipmaker exceeded profit expectations but warned of its slowest revenue growth in seven quarters due to ongoing supply chain constraints. Analysts noted that while the new flagship Blackwell chip's deliveries would be limited, demand is expected to outstrip supply into 2026, suggesting potential revenue boosts in the future.
In stark contrast to Nvidia's success, Alphabet faced significant headwinds as its stock price plummeted following news of a Department of Justice initiative to force the company to sell its Chrome browser. This regulatory scrutiny raised concerns among investors about the future of Alphabet's business model and its ability to maintain market dominance.
The broader market showed a mixed response, with investors rotating out of big tech stocks and favoring sectors like Utilities, Industrials, and Financials. The financial sector led the day, rising more than 1.5%, while the Consumer Discretionary and Communications Services sectors lagged behind.
On the macroeconomic front, weekly jobless claims fell to 213,000, indicating a healthier labor market. This decline has led investors to speculate on the Federal Reserve's potential interest rate decisions, with a 44% chance of maintaining current rates at the upcoming December meeting.
In the cryptocurrency market, Bitcoin surged to a new all-time high, briefly trading just below $99,000. This rally was fueled by optimism surrounding the incoming administration's potential for more crypto-friendly policies, particularly following the announcement of SEC Chair Gary Gensler's upcoming departure.
Overall, the stock market's reaction to Nvidia's earnings and Alphabet's challenges highlights the ongoing volatility and shifting investor sentiment in the tech sector, as well as broader economic indicators that could influence future market movements.
The TSX composite index rises to a seven-week high as the Federal Reserve's positive economic outlook boosts investor confidence, while the Bank of Canada cuts interest rates to support the economy.
European shares rebounded as the tech selloff eased, with retail stocks leading the gains. The STOXX 600 index closed at a record high, reflecting renewed investor confidence.
Italy's government supports Banca Monte dei Paschi's bid for Mediobanca, aiming to strengthen the banking sector and enhance the economy.
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