Apple, Nvidia Losses Keep S&P 500, Nasdaq Flat as Fed's Rate Verdict Looms

A smartphone with a displayed NVIDIA logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
A smartphone with a displayed NVIDIA logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
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Apple, Nvidia Losses Keep S&P 500, Nasdaq Flat as Fed's Rate Verdict Looms

A smartphone with a displayed NVIDIA logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo
A smartphone with a displayed NVIDIA logo is placed on a computer motherboard in this illustration taken March 6, 2023. REUTERS/Dado Ruvic/Illustration/File Photo

The S&P 500 and the Nasdaq treaded water on Wednesday, as losses in tech heavyweights Apple and Nvidia limited broader gains and investor focus turned to the US Federal Reserve's interest-rate decision, expected later in the day.

Markets widely expect the central bank to hold its lending rate steady in its decision, due at 2 p.m. ET.

"Without clarity on the macro impact of a range of government policies, primarily tariffs, but also on tax policy and the labor market impact of immigration policy, we think it's fair to expect limited guidance from the Fed today," Goldman Sachs economists said in a note.

At 9:46 a.m. ET, the Dow Jones Industrial Average rose 23.73 points, or 0.05%, to 44,874.08, the S&P 500 lost 16.71 points, or 0.26%, to 6,052.02, and the Nasdaq Composite lost 112.68 points, or 0.53%, to 19,628.68.

Six of the 11 S&P 500 sectors were in the red, with technology stocks leading declines with a 1.1% fall.

Nvidia dropped 3.3% after gaining close to 9% on Tuesday. Its shares were hammered on Monday, after Chinese startup DeepSeek launched AI models it said were cost-effective and ran on less advanced chips compared to OpenAI.

Apple shed 1.1% after brokerage Oppenheimer downgraded its rating to "perform" from "outperform". The iPhone maker is scheduled to report quarterly earnings later this week.

Of the 112 companies in the S&P 500 that have reported earnings so far, 75.9% reported numbers above analyst expectations, according to data compiled by LSEG.

Meanwhile, shares of semiconductor firms and related equipment makers advanced after Dutch firm ASML reported fourth-quarter bookings of 7.09 billion euros ($7.39 billion), far exceeding expectations.

KLA Corp rose 1.5%, Applied Materials was up 1.3%, Lam Research gained 0.5% and Micron Technology added 1.1% in morning trading.

The Nasdaq jumped 2% in the previous session, while the S&P 500 rose close to 1%, as Nvidia and other artificial intelligence-linked tech shares recovered somewhat from the steep losses suffered earlier in the week, Reuters reported.

Markets have been on edge due to worries around US President Donald Trump's proposed tariffs, which could exacerbate inflationary pressures and slow rate cuts.

The December reading of the personal consumption expenditures price index, a crucial metric in assessing the inflation trajectory, is due on Friday.

Among earnings, T-Mobile added 7.4% after the company forecast stronger-than-expected annual subscriber growth driven by increased demand for its affordable premium 5G plans.

Danaher shed 7.7% after the life sciences company missed estimates for fourth-quarter profit, due to soft demand for tools and services used in drug development by its biotech and pharmaceutical clients.

Earnings from Magnificent 7 stocks Microsoft, Facebook-parent Meta and Tesla are expected after markets close.

Cybersecurity and cloud services company F5 jumped 5.1% after forecasting second-quarter revenue above estimates and posting a first-quarter revenue beat.

Advancing issues outnumbered decliners by a 1.09-to-1 ratio on the NYSE, while declining issues outnumbered advancers by a 1.29-to-1 ratio on the Nasdaq.

The S&P 500 posted 18 new 52-week highs and two new lows, while the Nasdaq Composite recorded 36 new highs and 52 new lows.



Musk Says Chatbot Grok 3 Will Be Unveiled Monday

 A 3D-printed miniature model of Elon Musk and xAI logo are seen in this illustration taken, February 16, 2025. (Reuters)
A 3D-printed miniature model of Elon Musk and xAI logo are seen in this illustration taken, February 16, 2025. (Reuters)
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Musk Says Chatbot Grok 3 Will Be Unveiled Monday

 A 3D-printed miniature model of Elon Musk and xAI logo are seen in this illustration taken, February 16, 2025. (Reuters)
A 3D-printed miniature model of Elon Musk and xAI logo are seen in this illustration taken, February 16, 2025. (Reuters)

Elon Musk said his startup xAI will release its Grok 3 chatbot on Monday and billed it as the "smartest AI on Earth" in a fiercely competitive market.

The company's flagship artificial intelligence product will go live with a demonstration on Monday night at 8:00 pm Pacific time (0400 GMT), the tech billionaire wrote Saturday on his social media platform X.

Grok 3 was trained on synthetic data and is capable of reflecting on errors it makes by going over data in order to reach logical consistency.

"Will be honing product with the team all weekend, so offline until then," said Musk, the world's richest person and a top advisor to President Donald Trump who is tasked with slashing government spending.

Musk said last week that Grok 3 was in the final stages of development and would be released to the world in a matter of weeks.

xAI is seeking a competitive edge in a market teeming with products like OpenAI's ChatGPT as artificial intelligence spreads through contemporary life.

Chinese startup DeepSeek shocked the global AI industry last month with the launch of its low-cost, high-quality chatbot -- a challenge to US ambitions to lead the world in developing the technology.

DeepSeek quickly overtook ChatGPT in downloads on the Apple app store.

Musk has repeatedly warned that AI poses a risk to human civilization, but he is nonetheless pushing hard for a bigger slice of investment in the sector.

xAI said in December it raised $6 billion in its latest funding round from investors that included US venture capitalists, chipmakers Nvidia and AMD, among others. It raised an initial $6 billion in May.

The company is now one of the world's most valuable startups, though still dwarfed by OpenAI.

Musk, who also acts as boss of SpaceX and Tesla, launched the AI company in July 2023 shortly after he signed an open letter calling for a pause in the development of powerful AI models.

OpenAI's board chairman on Friday said it has unanimously rejected a Musk-led offer to buy the company for $97.4 billion.