What Happened?

A number of stocks fell in the afternoon session after markets faded the Nvidia rally in the morning session, as investors remained uncertain about future rate cuts. 

While the trading day began with significant enthusiasm, pushing the Dow Jones Industrial Average up more than 700 points and the Nasdaq Composite up 2.6%, momentum quickly evaporated as the session wore on. The primary catalyst for this sharp reversal was a stronger-than-expected jobs report, which reduced the implied odds of a December interest rate cut to less than 40%. This macroeconomic anxiety overshadowed stellar corporate performance. Nvidia initially surged 5% on blockbuster earnings and CEO Jensen Huang's bullish outlook on "off the charts" demand for Blackwell chips. However, the stock eventually turned negative, acting as a heavy weight that dragged the broader indices into the red. The sell-off partly reflects a deepening caution regarding high-flying tech valuations in a "higher-for-longer" rate environment. 

Consequently, investors appeared to rotate capital away from volatile growth sectors and toward defensive staples, evidenced by Walmart's 6% gain following its own earnings beat. Ultimately, the market could not sustain the morning's euphoria, as traders prioritized rate realities over AI potential.

The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.

Among others, the following stocks were impacted:

• Processors and Graphics Chips company AMD (NASDAQ: AMD) fell 6%. Is now the time to buy AMD? Access our full analysis report here, it’s free for active Edge members.
• Memory Semiconductors company Micron (NASDAQ: MU) fell 9.7%. Is now the time to buy Micron? Access our full analysis report here, it’s free for active Edge members.
• Memory Semiconductors company Seagate Technology (NASDAQ: STX) fell 6.2%. Is now the time to buy Seagate Technology? Access our full analysis report here, it’s free for active Edge members.
• Memory Semiconductors company Western Digital (NASDAQ: WDC) fell 8%. Is now the time to buy Western Digital? Access our full analysis report here, it’s free for active Edge members.
• Semiconductor Manufacturing company Entegris (NASDAQ: ENTG) fell 6.4%. Is now the time to buy Entegris? Access our full analysis report here, it’s free for active Edge members.

Zooming In On Micron (MU)

Micron’s shares are extremely volatile and have had 35 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.

The previous big move we wrote about was 2 days ago when the stock dropped 5.9% on the news that concerns regarding lofty artificial intelligence valuations triggered a pullback in the technology sector. Nvidia slid 3% ahead of its earnings report, dragging down fellow "Magnificent Seven" peers despite a major partnership announcement with Anthropic, as investors increasingly question the durability of the AI rally. Market sentiment was further dampened by Bitcoin dropping below $90,000, signaling reduced risk appetite, and growing anxiety that the Federal Reserve may pause rate cuts in December, with the implied probability of a cut falling to roughly 50%. Adding to the weakness, Home Depot shares declined following an earnings miss and a cut to its full-year outlook. This combination of continued de-risking and valuation skepticism put the S&P 500 on pace for its fourth consecutive daily decline.

Micron is up 129% since the beginning of the year, but at $199.72 per share, it is still trading 21.2% below its 52-week high of $253.30 from November 2025. Investors who bought $1,000 worth of Micron’s shares 5 years ago would now be looking at an investment worth $3,253.

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