Nasdaq posts fifth straight record high… Tesla surges 7% [New York market briefing]

Mixed close as consumer sentiment worsens and investor sentiment diverges

The three major U.S. stock indexes closed mixed as weakening consumer sentiment and strength in tech stocks appeared simultaneously.

On the 12th (local time) at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 45,834.22, down 273.78 points (0.59%) from the previous session. The Standard & Poor's (S&P) 500 index was down 3.18 points (0.05%) at 6,584.29, and the Nasdaq index closed at 22,141.10, up 93.03 points (0.44%). Nasdaq extended its record-high streak to a fifth consecutive day.

Early trading digested the August U.S. consumer price index (CPI) result released the previous day (a 2.9% year-on-year increase) and moved in a narrow range.. However, the preliminary consumer sentiment index, which reflects U.S. consumers' economic confidence, fell to 55.4, down 2.8 percentage points (4.8%) from the prior month (58.2) and below the market forecast (58), which dampened investor appetite for cyclical stocks sensitive to economic changes. Accordingly, Dow components Visa, IBM, Salesforce, American Express, Merck, and Amgen fell around 2%.

By contrast, large-cap tech stocks showed strength. Tesla rose 7.36% for the day following gains the previous day. Expectations for expansion in artificial intelligence (AI) and humanoid robot businesses were seen as driving the stock's rise. All tech companies with market capitalizations above 1 trillion dollars, except Amazon, saw their stocks rise. However, Oracle, which had surged the most in a day in 33 years after a spike in cloud contracts, faced continued selling and fell 5.09%, bringing its market capitalization down to 830 billion dollars.

Warner Bros. Discovery, a U.S. content producer, rose more than 16% on the day after jumping 29% the previous day. Paramount SkyDance, linked to takeover speculation of Warner Bros., rose 7.62%. Micron Technology climbed more than 4% on hopes for the AI industry, hitting an all-time high. According to CME FedWatch, federal funds rate futures showed a 75.7% probability of a 75bp rate cut by December. The CBOE volatility index (VIX) rose 0.05 points (0.34%) to 14.76.

Minsung Hong, Hankyung.com reporter mshong@hankyung.com