The Nasdaq fell hardest in the stock market today, as surging chips couldn't offset losses by big-cap techs and gaming software makers.
XThe tech-heavy Nasdaq shed 0.4%, the S&P 500 gave up 0.2% and the Dow Jones Industrial Average edged 0.1% lower. The S&P 500 halted a five-session advance after encountering resistance at its 200-day moving average. Small caps, as tracked by the Russell 2000, also fell 0.1%. Volume was higher on the NYSE but lower on the Nasdaq vs. Tuesday, according to preliminary data.
The Dow suffered the smallest loss, thanks to 1% gains by UnitedHealth Group (UNH) and American Express (AXP). But DowDuPont (DWDP) fell 2%, while Microsoft (MSFT), Caterpillar (CAT) and Walt Disney (DIS) gave up about 1% each.
Big-cap techs weighed on the Nasdaq. In addition to Microsoft, the FANG stocks all declined. Google parent Alphabet (GOOGL) fared the worst, stumbling 2.5% to fall back below its 200-day line.
Chip stocks led the upside among sector gainers in the stock market today. In the chipmakers group, Skyworks Solutions (SWKS) and Microchip Tech (MCHP) surged 12% and 7%, respectively. Several analysts including Goldman Sachs upgraded or raised their price targets on Skyworks after the company's late Tuesday earnings report.
Also after the close Tuesday, IBD 50 stock Microchip reported. The chipmaker's fiscal Q3 results topped views, though its current-quarter guidance disappointed. Shares gapped up well above the 200-day line to their best level since August.
Chip Stocks Soar In Stock Market Today
Chip designers were led by MaxLinear (MXL), which vaulted 11% to a nine-month high. The stock soared past the 21.06 entry of a 10-week base, which is part of a longer pattern. It remains near the top of its potential buy zone.
Other leading chip designers included IBD 50 members Xilinx (XLNX) and Monolithic Power Systems (MPWR), as well as Broadcom (AVGO), up more than 2% each.
Trade Desk (TTD) and Match Group (MTCH), which reports after the close, led the downside on the IBD 50. Trade Desk tumbled 5% and Match Group more than 4%. The Innovator IBD 50 ETF (FFTY), down 0.7%, snapped a five-session win streak.
Gaming software, tech services and homebuilders were among the biggest sector losers. The gaming software group plunged 12% as Take Two Interactive (TTWO), Electronic Arts (EA) and Activision Blizzard (ATVI) shed more than 10% apiece. Take Two fell to its lowest price since August 2017, Electronic Arts gapped below its 50-day line and Activision Blizzard tumbled to a two-year low.
Take Two blew away fiscal Q3 earnings and sales forecasts on strong sales of "Red Dead Redemption 2" and "NBA 2K19." But soft guidance for the current quarter hit the video game maker's shares. Electronic Arts' late Tuesday quarterly results missed views; Activision Blizzard reports next Tuesday.
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