Tech Stocks Tumble Amid Inflation Data and Rate Cut Expectations
Major stock indexes declined, driven by falling technology shares. Dell Technologies dropped over 9% due to high manufacturing costs for AI-optimized servers. Inflation data fueled speculation of an interest rate cut in September. The Nasdaq and major financial markets recorded losses ahead of the Labor Day holiday.
On Friday, significant stock indexes experienced a decline, led by technology shares such as Dell Technologies, while the dollar weakened against the euro. This movement followed U.S. inflation data that bolstered predictions of a potential interest rate cut in September.
Dell Technologies saw a plunge of more than 9% after reporting elevated manufacturing costs for its AI-optimized servers. This triggered a broader selloff in AI-related stocks, with Nvidia dropping by 3.5% and Broadcom by 4.2%, causing the Nasdaq to fall over 1%.
Economists' projections held true as the U.S. Commerce Department's Personal Consumption Expenditures Price Index showed a 0.2% rise in July. Core inflation maintained a steady pace. Speculation grew for multiple rate cuts starting in September, following dovish signals from Fed Chair Jerome Powell.
(With inputs from agencies.)
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