Stock Market Today, May 7: Nokia Drops by 6% as Momentum Stalls
Nokia (NYSE:NOK), the Finnish network equipment and solutions firm, closed Thursday at $12.35, down 6.37%. Shares may have fallen on profit-taking or broader AI valuation jitters. European stocks slipped today on geopolitical concerns.
Trading volume reached 125.8 million shares, coming in about 70% above its three-month average of 74.3 million shares. Nokia IPO'd in 1994 and has grown 858% since going public.
How the markets moved today
The S&P 500 (SNPINDEX:^GSPC) slipped 0.38% to close at 7,337, while the Nasdaq Composite (NASDAQINDEX:^IXIC) edged down 0.13% to finish at 25,806. Within communications equipment, industry peers were mixed, as Ericsson closed at $11.76, down 2.02%, while Cisco finished at $92.16, up 0.58%.
What this means for investors
Despite today’s losses, Nokia is up almost 90% year-to-date following a strong run, driven by artificial intelligence (AI) and military infrastructure developments. Earlier this week, Nokia and Lockheed Martin announced the launch of a new 5G solution for the U.S. Department of War.
The price dip comes despite strong Q1 earnings and recent analyst upgrades from Argus and Arete. Argus upgraded Nokia stock from “Hold” to “Buy” on the back of its recent performance and acquisition of Infinera Corp, an optical networks leader.
As momentum in AI stocks pushes them to record highs, valuation concerns are understandable. However, the demand for AI data centers shows no signs of slowing just yet and despite today’s dip, Nokia’s pivot into the space appears to be paying off.
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Emma Newbery has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Cisco Systems. The Motley Fool recommends Lockheed Martin. The Motley Fool has a disclosure policy.
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