Key points:

  • The S&P 500 and Nasdaq hit new all-time highs, helped by gains in Nvidia shares.
  • The Dow Jones index closed slightly higher.
  • US retail sales rose 0.1%, missing analysts’ forecasts.

American stock markets showed strong positive dynamics on Tuesday, June 18 – before the closure of the stock exchange for the weekend on Wednesday in honor of the Juneteenth holiday. The S&P 500 and Nasdaq indices set new record highs, sending Nvidia shares higher. At the same time, the Dow Jones index fell slightly higher amid strong pre-holiday trading and released weaker-than-expected US retail sales data.

The S&P 500 rose 0.25% to 5,487.03, hitting a new all-time high. The Nasdaq added 0.03% to 17,862.23 and hit a new high. The Dow Jones fell 0.15% to 38,834.86.

Nvidia overtakes Microsoft

Nvidia overtook Microsoft to become the world’s most valuable company, ending the day with a market capitalization of $3.32 trillion. Shares of other chipmakers also extended their recent gains, pushing the Philadelphia SE Semiconductor Index to a record high.

Qualcomm, Arm Holdings and Micron posted gains of 2.1% to 8.7%, with Micron hitting a record high. The Nasdaq hit its seventh straight record closing high as gains in several chipmaker stocks offset losses in Alphabet, Amazon and Meta Platform.

Financials and technology were the best performers, posting gains of 0.64% and 0.61%, respectively. At the same time, communication services and consumer retail sectors were the most unprofitable.

Total trading volume on U.S. exchanges was 10.96 billion shares, below the average of 11.79 billion shares over the past 20 trading days.

US macro data caused a muted reaction

Retail sales in the United States rose 0.1% in May, missing analysts’ forecasts of a 0.3% increase. At the same time, industrial production and manufacturing output showed more optimistic results, showing unexpectedly strong growth.

These economic data caused a muted reaction in the markets. The likelihood of the Federal Reserve cutting interest rates twice this year has increased slightly, but U.S. central bank forecasts still call for just one easing.

Comments from Fed representatives didn’t give the market a clear picture. New York Fed President John Williams said rate cuts would be gradual, while Richmond Fed’s Thomas Barkin said he needed more data before he backed cuts.

Despite the mixed economic signals, stocks generally posted gains. Investor interest in artificial intelligence companies and strong earnings from some tech companies have supported the market in recent months, but gains have been concentrated in a few large stocks.