Nvidia, megacaps power strong Nasdaq recovery; Dow pulls back
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Walmart falls after CFO flags Q2 to be challenging
Spirit AeroSystems falls after report of Boeing deal
Indexes: Dow down 0.74%, S&P up 0.32%, Nasdaq up 1.21%
Updated at 11:58 a.m. ET/1558 GMT
By Ankika Biswas and Lisa Pauline Mattackal
June 25 (Reuters) - The tech-heavy Nasdaq jumped over 1% onTuesday, buoyed by strength in Nvidiaand other megacaps, while the Dow slipped as investorsawaited a crucial inflation print this week forfurther cues on the U.S. monetarypolicy path.
AIchip firm Nvidia NVDA.O soared 6%, recovering some of the steep losses it had notched in three consecutive declining sessions. At current levels, the stock is still 12% away from last week's record high.
"The Nvidia story is currently more of a technical one, and not necessarily fundamental. It could be a great stock in the long run, but investors just need to be cautious," said Cetera Investment Management's chief market strategist, Brian Klimke.
Arm Holdings ARM.O, BroadcomAVGO.O and Applied Materials AMAT.O also gained 2%-4%, helping the Philadelphia SE semiconductor index .SOX rise 1.4% after its recent slide.
Megacaps including Alphabet GOOGL.O and Meta Platforms META.O rose 2% each, helping the S&P 500 communication services index .SPLRCL gain 1.3%. Technology .SPLRCT led sectoral gains, up 1.5%, recovering from a three-day slide.
The recent pullback in tech and tech-adjacent stocks had prompted investors to lap up lagging sectors, with utilities .SPLRCU and energy .SPNY enjoying strong gains on Monday.
"We've been calling for broadening to other segments for a while. Indexes are really concentrated within a few top holdings, so even though you've been hurt recently by these names doing so well, it's good to be diversified," Klimke added.
The Dow .DJI pulled back from a one-month high hit on Monday, while the small-cap Russell 2000 index .RUT alsolost some steam.
The Dow Jones Transport Average .DJT also dropped1.5% after recent gains. Index-heavyweight FedEx FDX.N lost 1% ahead of its quarterly results after markets close.
Technology and other growth stocks have driven the S&P 500 and the Nasdaq to record highs this year, but the continued underperformance in the value-tilted Dow has raised some concerns over the sustainability of equity strength.
The most-anticipated event of the week is the personal consumption expenditures (PCE) price index - the Fed's preferred inflation gauge - on Friday.
Traders see 61% odds of a 25-basis-point rate cut in September, and are eyeing around two cuts by the year-end, according to LSEG's FedWatch data.
At 11:58 a.m. ET, the Dow Jones Industrial Average .DJI was down 292.73 points, or 0.74%, at 39,118.48, the S&P 500 .SPX was up 17.30 points, or 0.32%, at 5,465.17, and the Nasdaq Composite .IXIC was up 211.11 points, or 1.21%, at 17,707.92.
Spirit AeroSystems SPR.N slumped 5.3%. A report showed Boeing BA.N has offered to acquire the airplane fuselage maker in a deal funded mostly by stock that values its key supplier at about $35 per share. Boeing dropped 3%.
Cruise operator CarnivalCorp CCL.N gained 7.4% after raising itsannual profit forecast for the second time this year.
Walmart WMT.N fell2.5% after itsCFO flagged the second quarter as the "most challenging quarter" at the NYSE 2024 European Investor Conference in London.
Declining issues outnumbered advancers for a 2.05-to-1 ratio on the NYSE andfor a 1.46-to-1 ratio on the Nasdaq.
The S&P index recorded 18 new 52-week highs and two new lows, while the Nasdaq recorded 32 new highs and 120 new lows.
Nvidia slides from record high but remains up 140% this year https://reut.rs/4eFvYwe
Reporting by Ankika Biswas and Lisa Mattackal in Bengaluru; Editing by Shounak Dasgupta and Maju Samuel
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