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The Dow Jones is being manipulated to offset weakness in the Semi-Conductors and NVIDIA.  Once Nvidia is added to the Dow Jones (which is likely in the works), this will change. 

Following a modest move to the upside early in the session, the major U.S. stock indexes moved in starkly opposite directions during trading on Thursday. While the Nasdaq and the S&P 500 pulled back off their early highs and into
negative territory, the narrower Dow saw continued strength.

The Dow ended the day up 299.90 points or 0.8 percent at a nearly one-month closing high of 39,134.76, but the S&P 500 fell 13.86 points or 0.3 percent to 5,473.17 and the Nasdaq slumped 140.64 points or 0.8 percent to 17,721.59.

While the early strength on Wall Street came amid a continued advanced by shares of Nvidia (NVDA), the subsequent downturn by the Nasdaq and the S&P 500 was also led by a significant pullback by the AI darling and marker leader.

Shares of Nvidia tumbled by 3.5 percent after surging by as much as 3.8 percent earlier in the trading day.

Nvidia shot up by 3.5 percent during trading on Tuesday, surpassing Microsoft (MSFT) as the world’s most valuable public company.

The downturn by the Nasdaq and the S&P may also have reflected profit taking after the indexes reached new record intraday highs, with the S&P 500 turning lower after climbing above 5,500 for the first time.

Meanwhile, the advance by the Dow came amid a 4.3 percent spike by shares of Salesforce (CRM) along with strong gains by Chevron (CVX) and IBM Corp. (IBM).

Traders were also digesting the latest batch of U.S. economic data, including a Labor Department report showing a modest pullback by first-time claims for U.S. unemployment benefits in the week ended June 15th.

The Labor Department said initial jobless claims dipped to 238,000, a decrease of 5,000 from the previous week’s revised level of 243,000.

Economists had expected jobless claims to fall to 235,000 from the 242,000 originally reported for the previous week.

The upwardly revised number for the previous week marked the highest level since claims reached 248,000 in the week ended August 12, 2003.

“Initial claims fell less than we anticipated in the week ended June 15 and point toward a moderation in growth in non farm payrolls in June,” said Ryan Sweet, Chief U.S. Economist at Oxford Economics.

He added, “The risk of labor demand being too weak to prevent the unemployment rate from rising could give some support in cutting interest rates as an imbalance in the labor market is unlikely to be a significant factor in future inflation.”

Meanwhile, a separate report released by the Commerce Department unexpectedly showed a steep drop in new residential construction in the U.S. in the month of May.

The Commerce Department said housing starts plunged by 5.5 percent to an annual rate of 1.277 million in May after surging by 4.1 percent to a revised rate of 1.352 million in April.

Economists had expected housing starts to climb by 0.7 percent to an annual rate of 1.370 million from the 1.360 million originally reported for the previous month.

The report also said building permits slumped by 3.8 percent to an annual rate of 1.386 million in May after tumbling by 3.0 percent to a rate of 1.440 million in April.

Building permits, an indicator of future housing demand, were expected to increase by 0.7 percent to an annual rate of 1.450 million.

Sector News

Semiconductor stocks moved sharply lower amid the downturn by Nvidia, dragging the Philadelphia Semiconductor Index down by 2.7 percent.

Notable weakness also emerged among computer hardware stocks, as reflected by the 1.1 percent loss posted by the NYSE Arca Computer Hardware Index.

On the other hand, gold stocks showed a substantial move to the upside on the day, driving the NYSE Arca Gold Bugs Index up by 2.5 percent. The rally by gold stocks came amid a significant increase by the price of the precious metal.

An increase by the price of crude oil also contributed to considerable strength among oil producer stocks, resulting in a 1.6 percent gain by the NYSE Arca Oil Index.

Other Markets

In overseas trading, stock markets across the Asia-Pacific region turned in a mixed performance during trading on Thursday. Japan’s Nikkei 225 Index crept up by 0.2 percent, while China’s Shanghai Composite Index fell by 0.4 percent.

Meanwhile, the major European markets all moved notably higher on the day. While the French CAC 40 Index surged by 1.3 percent, the German DAX Index jumped by 1.0 percent and the U.K.’s FTSE 100 Index advanced by 0.8 percent.

In the bond market, treasuries moved back to the downside following the rebound seen on Tuesday. Subsequently, the yield on the benchmark ten-year note, which moves opposite of its price, climbed 3.7 basis points to 4.254 percent.

Looking Ahead

Trading on Friday may be impacted by reaction to the latest U.S. economic data, including separate reports on existing home sales and leading economic indicators.