The Dow Jones Industrial Average closed at a record high on Thursday in mixed trading after strong U.S. economic data, while artificial intelligence (AI) chipmaker Nvidia fell after its earnings forecast was broadly in line with expectations but failed to impress investors.
The Dow Jones Industrial Average rose 243.63 points, or 0.6 percent, to 41,335.05 after hitting an all-time high of 41,577.97. The blue-chip index's previous record close of 41,250.50 was on Tuesday.
The S&P 500 was flat, while the Nasdaq fell 0.2%.
The Commerce Department reported that strong consumer spending helped the economy grow at a faster pace than initially expected, supporting views that the U.S. can avoid a recession.
“A downward revision to inflation accompanied by an upward revision to spending provides the case for a soft landing,” said Jeffrey Roach, chief economist at LPL Financial.
Nvidia's quarterly revenue guidance issued late Wednesday disappointed investors who had become accustomed to the chipmaker sharply beating expectations in recent quarters.
Nvidia shares fell 6.4%, trimming its 2024 gains to 144%.
AI stocks were mixed: Microsoft rose 0.6%, while Google parent Alphabet and Broadcom fell nearly 1%.
“It's too early to be bearish on AI companies; we think there's still upside to be had,” said Terry Sandven, chief equity strategist at U.S. Bank Wealth Management. “We think we're still in the relatively early stages of the AI revolution, which bodes well for tech stocks.”
Shares rose 1.5% after Citigroup named iPhone maker Apple its top AI stock.
The Labor Department reported that claims for unemployment benefits last week were slightly lower than expected.
The personal consumption expenditure report for July, due on Friday, could give a hint about the trajectory of the central bank's monetary policy easing.
According to CME Group's FedWatch tool, there is a 67.5% chance of a 25 basis point rate cut in September, and a 32.5% chance of a 50 basis point rate cut.
Cybersecurity company CrowdStrike rose 2.8% after beating quarterly revenue expectations, while Dollar General fell 32% after sharply cutting its full-year sales and profit forecasts.
