The US stock market divided sharply on Thursday as investors moved away from several large technology companies. Apple led losses across the sector, pulling the NASDAQ Composite lower despite strong gains from Micron Technology.

Meanwhile, healthcare, financial and industrial stocks supported the Dow Jones Industrial Average. The blue-chip index gained about 598 points, or 1.1%, and reached a record level. The S&P 500 rose 0.4%, while the NASDAQ fell 0.4%.

Apple Price Increases Pressure Technology Stocks

Apple shares dropped nearly 5% after the company increased prices across several MacBook and iPad models. Apple linked the changes to rising memory and storage chip costs as AI data-center demand limits supplies for consumer electronics companies.

The entry-level MacBook Neo rose from $599 to $699. Apple also increased the price of a MacBook Air with 512GB of storage from $1,099 to $1,299. A MacBook Pro with 1TB of storage increased from $1,699 to $1,999. Apple left iPhone prices unchanged.

Additionally, the announcement raised concerns about higher component costs across the wider technology industry. Alphabet and Meta Platforms each fell more than 1%. NVIDIA, Amazon and Microsoft also moved lower as traders assessed the cost pressure facing major chip buyers.

These losses outweighed gains among several semiconductor companies and pulled the NASDAQ into negative territory. SpaceX shares also fell about 1%, extending Wednesday’s decline. The stock briefly approached $150 before recovering above $153.

Micron Earnings Support Semiconductor Shares

Micron Technology provided support to the technology sector after reporting fiscal third-quarter earnings above market forecasts. The memory-chip maker also issued a stronger outlook for the current quarter as demand from AI data centers boosted sales and pricing.

Micron shares initially jumped more than 15% before reducing part of the advance. Its market value briefly rose above $1.4 trillion and passed Meta and Tesla before falling below both companies as the stock moved away from its session high.

Meanwhile, Qualcomm gained after raising its long-term revenue forecast for businesses outside smartphones. The company now expects those operations, including data-center products, to generate $40 billion in annual revenue by fiscal 2029.

Other chip-related stocks also advanced. Sandisk, Western Digital, KLA and Applied Materials gained as Micron’s results showed strong demand for memory and equipment. Still, those advances failed to offset losses among the largest technology companies.

Dow Gains as Investors Move into Other Sectors

The Dow received support from companies outside the technology sector. Moreover, Alphabet, Google’s parent company, will officially join the 30-stock Dow Jones Industrial Average before trading begins on Monday, June 29. The technology company will replace Verizon Communications, which has been part of the index since 2004. 

Johnson & Johnson and JPMorgan Chase each gained more than 2%, while Caterpillar rose almost 5%. Financial, healthcare and industrial shares led the index higher. 

The shift showed that investors had not withdrawn broadly from US stocks. Instead, traders moved capital between sectors as they reviewed company earnings, product costs and technology valuations. The S&P 500 stayed positive due to its wider exposure across the market.

Notably, the Dow’s advance contrasted with the NASDAQ’s decline. Apple stock carries substantial weight in major market indexes, while falling shares in Alphabet, Meta, NVIDIA, Amazon and Microsoft increased pressure on technology benchmarks.

Inflation Data Keeps Federal Reserve Questions Open

May’s Personal Consumption Expenditures price index rose 0.4% from April, below the expected 0.5% increase. Annual headline inflation reached 4.1%, matching forecasts and marking its highest level in more than three years.

Core PCE, which excludes food and energy, increased 0.3% for the month and 3.4% from a year earlier. Both readings matched economists’ estimates. Consumer spending also increased, while first-quarter economic growth received an upward revision to an annual rate of 2.1%.

Brian Jacobsen of Annex Wealth Management said, “The worst of inflation and consumer angst may be mostly behind us.” However, his statement carried doubt, as he added that inflation expectations would likely fall only “as long as gasoline prices trend lower.”

Treasury yields edged down after the report. The benchmark 10-year yield fell more than two basis points to about 4.37%. Although the inflation figures met forecasts, the 4.1% annual rate kept questions about future Federal Reserve policy active.

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