Tech Shares Shine as U.S. Stocks Edge Lower After Record Highs

U.S. stocks slightly declined on Friday following a series of record highs. Gains in Adobe and other technology shares limited the losses. The Nasdaq and S&P 500 remained on track for a strong weekly performance. Investors are assessing economic data and Fed policy changes, while Nvidia briefly surpassed Apple in market value.

U.S. stocks edged lower on Friday after a string of record highs, but gains in Adobe and other technology shares limited the decline.

The Nasdaq and S&P 500, which registered their fourth straight record closing highs on Thursday, were still on track for strong gains for the week. The S&P 500 technology sector rose 0.5%. Adobe shares jumped 14.4% after the company raised its annual revenue forecast on more demand for its AI-powered software.

Investors were also digesting economic data to try to gauge how soon the Federal Reserve might be able to cut interest rates. A preliminary reading of the University of Michigan's Consumer Sentiment Index slipped to 65.6 in June, sharply lower than expectations.

On Wednesday, Fed policymakers dialed back their projections for three cuts this year to just one.

"The market is extended and due to pull back," said Adam Sarhan, chief executive of 50 Park Investments in New York. "You've had a big rally this week, led by big-cap tech. Under the surface, we have a lot of areas acting weak." The Dow Jones Industrial Average fell 116.28 points, or 0.3%, to 38,530.82. The S&P 500 lost 10.57 points, or 0.19%, at 5,423.17 and the Nasdaq Composite dropped 6.95 points, or 0.04%, to 17,660.61.

The Russell small-cap index was down 1.8%. Nvidia shares were up 1.5% in afternoon trading, after briefly surpassing Apple as the second most valuable company in the world.

Declining issues outnumbered advancers on the NYSE by a 2.96-to-1 ratio; on Nasdaq, a 2.69-to-1 ratio favored decliners. The S&P 500 posted 10 new 52-week highs and 16 new lows; the Nasdaq Composite recorded 24 new highs and 170 new lows.

(Additional reporting by Lisa Mattackal and Johann M Cherian in Bengaluru; Editing by Maju Samuel and Richard Chang)

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