Supermicro, Arista Networks, and Nvidia Lead Tech Selloff

• The S&P 500 fell 1.1% on Wednesday, March 26, 2025, as tech stocks faltered and the White House prepared to announce tariffs on car imports.

• Shares of Super Micro Computer, Arista Networks, Nvidia, and Tesla led tech losses.

• Uniform supplier Cintas posted strong earnings results, highlighting benefits from recent acquisitions, and its shares pushed higher.
  

Major U.S. equities indexes sputtered in the midweek trading session following reports that President Trump would announce levies on vehicles imported to the U.S.

The S&P 500 dropped 1.1%, while the Dow slipped 0.3%. Underperformance in the tech sector dragged down the Nasdaq, which tumbled 2%.

Super Micro Computer (SMCI) shares led losses on the S&P 500, plunging 8.9%. Wednesday’s drop extended losses earlier in the week after Goldman Sachs analysts downgraded Supermicro stock to “sell” from “neutral,” noting that increased competition in the AI server market could restrain gross margins.

Shares of cloud networking specialist Arista Networks (Aneta) also fell as AI and chip stocks faltered, with shares down 6.1%. Nvidia (NVDA) stock slipped 5.7%, leading losses on the Dow, amid concerns about additional constraints on AI chip sales in China. Shares of Vistra (VST), a utility that has drawn attention for its opportunity to power AI data centers, dropped 5.9%.

Modern (MRNA) stock declined 7% after reports that the U.S. would discontinue funding for Gavi, the Vaccine Alliance, a global partnership aimed at improving the availability of immunizations in developing countries. Shares of other vaccine manufacturers also lost ground.

Following five straight positive trading sessions, Tesla (TSLA) shares fell 5.6% Wednesday, threatening the EV maker’s rebound from a prolonged slump. The stock had gained more than 27% in the week leading up to Wednesday’s session, boosted by the potential for watered-down tariffs and several endorsements.

Tapes (CTAS) shares logged the S&P 500’s top daily performance, surging 5.8% after the supplier of uniforms and other products for the workplace reported better-than-expected sales and profits. The company highlighted recent acquisitions as a driver of revenue growth but indicated that it will step away from its proposed takeover of fellow uniform and facility service provider UniFirst (UNF), citing an inability to agree on key terms.

Payroll processor Paychex (Payx) also received a boost from its quarterly earnings report, with shares gaining 4.2% on Wednesday. Although the uncertain economic environment weighed on demand for the company’s human capital management services, contributing to lower-than-expected quarterly sales figures, stringent cost-control measures helped Paychex exceed profit forecasts.