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Nvidia ( NVDA ) market cap briefly overtakes Apple's ( AAPL )

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Capri plummets after US judge blocks Tapestry merger

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Nasdaq up 0.56%, Dow down 0.61%, S&P flat

(Updates with final numbers)

By Lisa Pauline Mattackal, Purvi Agarwal and Carolina Mandl

Oct 25 (Reuters) -

The Nasdaq ended higher on Friday, driven by megacap shares,

as investors awaited quarterly results from some of Wall

Street's biggest companies next week.

Tesla shares rose 3.36% a day after surging 22%

on the electric vehicle maker's sales forecast. Amazon ( AMZN ),

Apple ( AAPL ) and Microsoft ( MSFT ) also rose.

"Tesla numbers helped rekindle some optimism of

investors that the Magnificent Seven rally is not over," said

Brian Jacobsen, chief economist at Annex Wealth Management.

He was referring to the group of interest rate-sensitive

technology stocks which have surged on enthusiasm for artificial

intelligence. Chip heavyweight Nvidia ( NVDA ) gained, briefly

overtaking Apple ( AAPL ) as the world's most valuable company

based on its shares.

The benchmark 10-year Treasury note yield edged higher

as investors awaited U.S. employment data next week for clues on

the likely path of Federal Reserve interest rate cuts. Earlier

this week, the yield reached a three-month high of 4.26%,

weighing on the stock market.

The Dow Jones Industrial Average fell 259.96 points,

or 0.61%, to 42,114.40, the S&P 500 lost 1.74 points, or

0.03%, to 5,808.12 and the Nasdaq Composite gained

103.12 points, or 0.56%, to 18,518.61.

The Dow slumped as banking shares fell, with Goldman

Sachs ( GS ) down 2.27%, and as fast-food chain McDonald's

lost 2.97% while coping with an E. coli outbreak linked

to its hamburgers.

"Banks have rallied as (U.S. presidential candidate

Donald) Trump's odds (of winning) increased, so it seems

investors are taking some profits," said Michael Rosen, chief

investment officer at Angeles Investments.

Regional lender New York Community Bancorp ( NYCB/PA )

dropped 8.26% after reporting its fourth straight quarterly

loss

, primarily due to its commercial real estate loans.

Continued uncertainty around the U.S. election has made

investors cautious.

Equities have been unsettled this week by a rapid rise

in yields as bets on rate cuts by the Fed unraveled on

expectations of a stronger economic outlook.

Only the Nasdaq closed the week with gains. The

tech-heavy index rose 0.16%, while the S&P fell 0.96% and the

Dow sank 2.68%.

"The Fed perhaps got a little too dovish ahead of the

data. ... The growth and inflation numbers don't necessarily

justify easing behavior," said Arnim Holzer, global macro

strategist at Easterly EAB Risk Solutions.

Investors are still pricing in another 25-basis-point

rate cut at the Fed's November meeting and about two rate cuts

by the end of the year, LSEG data showed.

The week starting Oct. 28, the final stretch before the Nov.

5 U.S. presidential election, is crucial for Wall Street. This

is when results from megacap tech firms including Alphabet

, Apple ( AAPL ) and Microsoft ( MSFT ) are due, along

with the October U.S. nonfarm payrolls report.

"Next week looms large with five of the Magnificent Seven

stocks reporting and a host of tier one economic releases

spanning third quarter," said Paul Eitelman, chief investment

strategist for North America at Russell Investments.

Capri Holdings ( CPRI ) slumped 48.89% after a U.S. judge

blocked a pending merger between the fashion holding company and

handbag maker Tapestry. Shares of Tapestry rose 13.54%.

Most of the 11 S&P sectors closed down, with utilities

leading the pack.

Declining issues outnumbered advancers by a 1.56-to-1

ratio on the NYSE. There were 180 new highs and 43 new lows on

the NYSE.

The S&P 500 posted 30 new 52-week highs and two new lows

while the Nasdaq Composite recorded 78 new highs and 87 new

lows.

Volume on U.S. exchanges was 11.54 billion shares,

compared with the 11.28 billion average for the full session

over the last 20 trading days.