Stocks retreated Wednesday, with the Nasdaq composite leading declines as Nvidia and other chip stocks such as Broadcom traded lower.
On Tuesday, the Trump administration said Nvidia must meet new security requirements before sending H200 artificial-intelligence chips to China.
Bank shares also sold off as earnings rolled in. Bank of America posted a 12% rise in quarterly profit, boosted by consumer spending. But its stock dropped 3.8%, with Wells Fargo falling 4.6% after its net income missed forecasts. Citi stock retreated 3.3% after its quarterly profit was hit by a $1.2 billion loss from the announced sale of its Russia operations.
Stocks pared some losses and oil futures fell in afternoon trading following President Trump’s comments that the U.S. had been notified that Iran had “no plans to carry out any executions of protesters,” a sign of a potential de-escalation of tensions between the two countries.
The Nasdaq finished 1% lower, the S&P 500 dropped 0.5% and the Dow industrials were 0.1% lower. Gold and silver futures hit new record highs, boosted by recent geopolitical risks.
New data showed retail sales grew 0.6% in November, an unexpectedly sharp jump, while wholesale inflation was cooler than expected for that month, at 0.2%. Home sales rose in December at their fastest pace in nearly two years. Treasury yields fell, with the 10-year yield ending the day at 4.139%.
In Asia, Japan’s Nikkei 225 set another record high, and bond yields continued to rise. The country’s prime minister has called a snap election. South Korea’s Kospi composite also hit an all-time peak.