Key Takeaways

• The S&P 500 lost 2% on Tuesday, Sept. 3, 2024, opening the holiday-shortened week in negative territory amid weak manufacturing data.

• Shares of utilities Vistra and Constellation Energy lost ground, retreating from highs driven by lofty expectations for power demand from AI data centers.

• Molson Coors shares moved higher. The beverage giant finalized the sale of several craft breweries to Tilray Brands.

Major U.S. stock indexes plunged to kick off a shortened trading week after Labor Day as the latest Purchasing Managers Index (PMI) data indicated a contraction in manufacturing activity in August.

With the manufacturing woes reigniting concerns about a possible economic slowdown, the labor market will likely take the spotlight later in the week. Reports on job openings and private-sector hiring will culminate Friday in the release of the August employment numbers.

The S&P 500 fell 2.1% in Tuesday's session. The Dow lost 1.5%, while the tech-heavy Nasdaq plunged 3.3%.

Shares of Texas-based power generator Vistra (VST) plummeted more than 11%, the biggest drop of any S&P 500 stock. The company has drawn attention because of opportunities associated with demand for power from data centers running artificial intelligence (AI) technology and oil field operations. That had helped the stock gain more than 120% year to date heading into Tuesday's session.

Monolithic Power Systems (MPWR) shares dropped 10% on Tuesday. The manufacturer of power management chips saw its stock price soar to an all-time high last week as analysts at TD Cowen boosted their price target. However, recent regulatory filings showed that Monolithic's executive vice president of global operations sold $8.7 million worth of shares in the company.

Shares of Constellation Energy (CEG), a power utility headquartered in Maryland, sank 9.6%. Similar to Vistra, Constellation Energy stock has posted strong gains in 2024 driven by expectations of high demand from AI data centers. Although Bank of America analysts recently boosted their price target on the stock, predicting strength for the company in the second half of the year, they maintained a "neutral" rating on the shares. Recent reports have questioned whether Constellation Energy's debt levels could be a cause for concern.

Molson Coors Beverage (TAP) shares jumped 5.4%, marking the S&P 500's top daily performance on a day when food and drink stocks broadly performed well. Molson, owner of Miller beer and other brands, completed the sale of several craft breweries to cannabis-focused Canadian firm Tilray Brands (TLRY).