Stock market today: Wall Street is drifting as Nvidia loses some more momentum

NEW YORK (AP) U.S. stocks drift toward a quiet week's close Friday, as Nvidia's stock continues to cool after its surprising supernova run.

The S&P 500 was down 0.2% at midday, although it was still near its all-time high set Tuesday. The Dow Jones Industrial Average was down 40 points, or 0.1%, as of 11:30 a.m. Eastern Time, and the Nasdaq Composite Index was virtually unchanged.

Nvidia was once again trailing the market after a 2% drop. The company's shares have soared more than 1,000% since October 2022 on frenzied demand for its chips, which are powering much of the world's move toward artificial intelligence technology, and it briefly supplanted Microsoft this week as the most valuable company on Wall Street.

But nothing goes up forever, and Nvidias' declines over the past two days have put its stock on track for its first losing week in the last nine.

Much of the rest of Wall Street was relatively quiet, except for a few outliers.

Sarepta Therapeutics jumped 36.1% after U.S. regulators approved the use of its drug for children with Duchenne muscular dystrophy who are at least 4 years old.

CarMax rose 1.8% after reporting a profit for the latest quarter that beat analysts' expectations.

Gunmaker Smith & Wesson Brands fell 11.3% despite a profit for the latest quarter that was higher than analysts expected. Summer is traditionally a slower season for firearms, according to CEO Mark Smith.

Shares of Trump Media & Technology Group fell 4.8%, bringing its loss for the week to 31.3%. The company behind Donald Trump's Truth Social platform has seen its shares fall by half since the former president's conviction in late May on charges in a scheme to illegally influence the 2016 election by paying bribes. hush money to a porn actor who said the two had sex. .

Trading on Wall Street could see many changes throughout the day, with large swathes of futures and options to buy stocks and other types of investments expiring.

In the bond market, U.S. Treasury yields initially fell after a report suggested that trading activity among countries using the euro was weaker than economists expected. Concerns are already high for the continent in the run-up to French elections which could further shake the financial markets.

Weak reports on economic activity pushed yields lower in Europe, which initially weighed on Treasury yields. But U.S. yields recovered much of those losses after another later report indicated U.S. trade activity could be stronger than expected.

Overall output growth rose to its highest level in 26 months, according to preliminary figures from S&P Global on activity at U.S. manufacturing and service companies. Perhaps more importantly for Wall Street, this strength could occur without a concomitant increase in inflation pressures.

“Historical comparisons indicate that the latest decline aligns the survey's price gauge with the federal government's 2% inflation target, according to Chris Williamson, chief business economist at S&P Global Market Intelligence.

The Federal Reserve finds itself in a precarious situation, where it is trying to slow the economy by raising interest rates just enough to bring high inflation down to 2%. The thing is, he wants to cut interest rates at exactly the right time. If we wait too long, the economic slowdown could degenerate into a recession. If it is too early, inflation could reaccelerate.

Traders are still hopeful the Fed will succeed, with many predicting at least two interest rate cuts later this year, according to CME Group data. Of course, their predictions have repeatedly proven overly optimistic throughout history.

Fed officials themselves have planned one or two cuts in 2024 to their main interest rate, which is at its highest level in more than two decades. The economy continues to grow, although it has slowed under the weight of high interest rates. Real estate and manufacturing have been hit, while low-income households are struggling to keep up with continued rising prices.

The 10-year Treasury yield remains at 4.26%. The two-year Treasury yield was also unchanged at 4.74%.

In overseas stock markets, European shares fell after weak continental economic reports, and many Asian indexes also fell. Hong Kong's Hang Seng fell 1.7% and South Korea's Kospi fell 0.8%.

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AP Business Editor Yuri Kageyama contributed.