S&P 500 closes lower for a second session as tech-fueled rally cools: Live updates

The S&P 500 pulled back on Monday as the rally that brought the major averages to record highs cooled off.

The broad S&P 500 slipped 0.11% to 5,117.94. The Nasdaq Composite slid 0.41% to 16,019.27, as technology stocks struggled. Both saw their second negative sessions in a row. The Dow Jones Industrial Average bucked the trend, adding 46.97 points, or 0.12%, to finish at 38,769.66.

Information technology stock Super Micro Computer dropped more than 5%, while chipmaker Nvidia fell 2%. Both took a hit as investors question if stocks tied to artificial intelligence have more room to run after monster rallies.

Meta also struggled, with the Facebook parent tumbling 4.4%. Outside of tech, pharmaceutical stock Eli Lilly dropped more than 3%.

Those losses come as traders prepare for February’s consumer price index due Tuesday. Economists polled by Dow Jones anticipate CPI will rise 0.4% between January and February and 3.1% on an annualized basis. Excluding volatile food and energy prices, the so-called core basket is expect to increase 0.3% on the month and 3.7% on the year.

Later in the week, investor attention will turn to the producer-focused index. The two releases are among the last major economic reports expected before Federal Reserve leaders convene for their March policy meeting.

“At the end of the day, markets are probably still too optimistic about the Fed’s ability to cut rates significantly in 2024,” said Lara Rhame, chief U.S. economist at FS Investments. “I think the February inflation data will be another reminder that the Fed needs to tread cautiously.”

Monday’s action follows a losing week for the major averages that pulled the S&P 500 and Nasdaq off all-time highs.