Tech Stocks Sink, Gold Shines: A Volatile Day on Wall Street

U.S. stocks slumped on Wednesday, led by a sharp decline in technology shares, after Nvidia revealed a $5.5 billion charge tied to tightened U.S. export controls on its AI chips bound for China. The news triggered a broad tech selloff, weighing heavily on major indexes.

Nasdaq Suffers as Chipmakers Slide

The Nasdaq plunged 2.1% by midday, driven by steep losses among chipmakers. Nvidia shares dropped over 6%, dragging peers like AMD and Micron into the red. ASML, Applovin, and Applied Materials also shed more than 4% each, intensifying the sector-wide pressure.

The S&P 500 fell 1.2%, while the Dow Jones showed relative resilience, slipping just 0.5%, buoyed by gains in defensive stocks such as UnitedHealth and Travelers.

Retail Sales Climb, but Optimism Fades

Adding to the mixed picture, U.S. retail sales rose 1.4% in March — the largest monthly gain since January 2023 — pointing to continued consumer strength. Excluding autos and gas, sales advanced 0.8%, while the control group, a critical measure for GDP, rose 0.4%. February’s figure was revised up to 1.3%, lending some support to Q1 growth forecasts.

Still, inflation-adjusted spending has declined slightly over the past three months. Economists warn that despite resilient demand, economic momentum could stall if trade tensions escalate or monetary policy remains restrictive for too long.

Gold Climbs as Investors Flee to Safety

Amid the tech turbulence, investors rotated into safe havens. Gold surged past $3,300 an ounce, while Treasury yields held steady, reflecting market caution. With geopolitical and trade uncertainties growing, eyes are now turning to Federal Reserve Chair Jerome Powell’s next steps and the upcoming earnings season.

Mixed Signals from Manufacturing and Industrial Output

Manufacturing output rose 0.3% in March, slightly above forecasts, marking the strongest reading since the pandemic recovery began. Gains were led by computers, electronics, aerospace, and apparel. However, overall industrial production dipped 0.3%, dragged down by a steep 5.8% drop in utilities output.

Wells Fargo analysts noted signs of “tariff front-loading” as businesses ramped up imports ahead of potential levies, but warned this activity is likely temporary. They also pointed out that rising policy uncertainty is causing firms to delay capital expenditures, which may further hinder industrial momentum.

Outlook: Eyes on Powell and Earnings Season

With volatility spiking and trade concerns back in focus, the mood across Wall Street remains cautious. Nasdaq 100 futures had already pointed to a weak open, sliding 1.4% ahead of the bell. S&P 500 and Dow futures also declined, by 0.8% and 0.2%, respectively.

Despite hints that China may be open to restarting trade talks, investors are bracing for more turbulence. Whether the market can find its footing will largely depend on Fed policy direction and the tone set by upcoming corporate earnings. For now, tech woes continue to cast a long shadow over broader market sentiment.

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