Midday Market Brief: Nvidia Can’t Do All the Work

Hello and welcome back.

Nvidia has done a lot of work for the stock market recently, with the $2.8 trillion market cap AI chipmaker’s stock already jumping nearly 32% in May alone and helping lift the S&P 500 given its 6% weighting in the broader S&P 500.

But even Nvidia investors will take an occasional break and we then tend to see how healthy the rest of the market is. Nvidia shares increased only slightly on Wednesday, up 0.8%, and the other 499 stocks in the S&P 500 didn’t have enough oomph to drive the index higher. The S&P 500 was recently off 0.5%.

Interestingly, interest rates have bounced back to the level they were when Fed Chairman Jerome Powell suggested that any future rate hikes are off the table. The 10-year note yield was recently up to 4.63%

Movers & Shakers

Here are some of the stocks making news today:

• Marathon Oil shares surged 7.9% on news that it’s entered a definitive agreement to be acquired by ConocoPhillips in an all-stock transaction worth $22.5 billion. The move pushes Conoco further into several important US shale basin territories.
• Pet food e-commerce king Chewy’s stock jumped 28% after the company blew past first-quarter earnings estimates. The company issued downside guidance for Q2, but reaffirmed its outlook for the full year and authorized a $500 million stock repurchase program.
• American Airlines saw its stock lose altitude on Wednesday, recently down 14.3%, after cutting its second-quarter expectations for earnings and operating margins. Not a great look when the TSA said last Friday set a new record for most screened airline passengers in a single day.
• Dick’s Sporting Goods shares rose 15.5% after the retailer beat first-quarter estimates and boosted its full-year outlook. It turns out that massive remodels to introduce “experiences” into stores, like batting cages and rock-climbing walls was a pretty good move!