NEW YORK: The Nasdaq and the S&P 500 fell on Friday as a rally in chip stocks lost some steam, while a mixed labor market report showed that employers added more jobs than expected in February though the unemployment rate unexpectedly rose.

The two indexes briefly hit intra-day record highs earlier in the session before erasing gains.

AI darling Nvidia fell 1.5%, leading losses among megacap growth and technology peers after hitting a fresh record high, while the Philadelphia Semiconductor Index also came off a record peak, last down 1.8%.

“We’re just at a point where investors maybe have chased these stocks too much and they need to cool off a bit,” said Dennis Dick, a trader at Triple D Trading.

“What you’re seeing is profit-taking. People may be nervous going into the weekend.” Broadcom slid 5.6% after the tech company’s full-year forecast failed to impress investors.

Shares of Marvell Technology shed 9.1% after t forecast first-quarter results below market expectations on soft demand in its wireless infrastructure, consumer and enterprise markets.

At 11:42 a.m. ET, the Dow Jones Industrial Average was up 68.68 points, or 0.18%, at 38,860.03, the S&P 500 was down 1.81 points, or 0.04%, at 5,155.55, and the Nasdaq Composite was down 31.25 points, or 0.19%, at 16,242.13.

Meanwhile, US job growth accelerated in February, with nonfarm payrolls increasing by 275,000 jobs against an expected 200,000 rise. Data for January, however, was revised lower to show that 229,000 jobs were created.

The unemployment rate rose to 3.9% in February after holding at 3.7% for three straight months, while wage growth slowed to 0.1% on a monthly basis.

“At the end of the day this was a pretty dovish print because we had slower wage gains,” said Cameron Dawson, chief investment officer of NewEdge Wealth in New York.

“As of right now, the labor market is tight and healthy. However, it’s not as hot as it was, which takes some of the inflation pressure off.” This followed overnight commentary from Fed Chair Jerome Powell that central bank was “not far” from gaining the confidence that inflation is falling sufficiently to begin cutting interest rates.

Focus now shifts to consumer prices (CPI) data due next week for more cues on potential rate cuts.

Gap climbed 5.1% after the retailer beat Wall Street expectations for fourth-quarter results, buoyed by strong demand on improved product offerings at its Old Navy and namesake brands during the holiday season, and lower markdowns.

Costco Wholesale eased 6.6% as quarterly sales fell short of estimates due to tepid demand for higher-margin goods.

Advancing issues outnumbered decliners by a 1.90-to-1 ratio on the NYSE and by a 1.48-to-1 ratio on the Nasdaq.

The S&P index recorded 61 new 52-week highs and no new lows, while the Nasdaq recorded 108 new highs and 42 new lows.

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