U.S. stocks experienced a mostly downward trend on Wednesday as Wall Street evaluated a wave of recent earnings reports and anticipated the upcoming results from Alphabet, amidst concerns regarding how artificial intelligence (AI) could impact the technology sector. The S&P 500 index declined approximately 0.5%, while the Nasdaq Composite fell over 1.5%, extending losses from the previous day. In contrast, the Dow Jones Industrial Average managed a modest gain of 0.4% as investors shifted their focus away from technology stocks toward more stable blue-chip companies.
Wall Street continues to struggle amidst fears of disruption caused by AI, which has led to significant sell-offs in software stocks and a broader decline across global markets, affecting both Europe and Asia. The prevailing worries surrounding AI’s implications have prompted a trend away from high-profile tech companies toward value stocks, negatively impacting major players in the tech space. Nvidia saw its shares drop more than 3%, while Google reported nearly a 2% decrease ahead of its earnings announcement. Other tech giants like Amazon and Tesla also faced declines, falling over 2% and more than 3%, respectively.
Despite some companies delivering better-than-expected earnings, JPMorgan cautioned that these results may not sway investors unless they can demonstrate that AI will significantly contribute positively to their business. Advanced Micro Devices witnessed a steep decline in its stock price, as the company provided a lackluster sales outlook that raised doubts about its competitive capacity against AI leader Nvidia.
Adding to the mixed economic signals, an ADP report revealed that American employers added only 22,000 jobs in January, falling short of the anticipated 45,000. This private data has gained importance due to the delays in federal job statistics attributed to a partial government shutdown, which just recently concluded. The official jobs report from the Bureau of Labor Statistics is now set to be released next Wednesday.
On the commodities front, gold prices increased amidst ongoing tensions between the U.S. and Iran, although following a significant drop, it fell back below $5,000 an ounce. Cryptocurrency markets were not spared from the downturn either, with Bitcoin trading around $72,000, reflecting accumulated losses.
In corporate news, the pharmaceutical sector displayed mixed fortunes. Eli Lilly’s stock surged following a positive profit forecast for 2026, driven by increasing demand for its weight-loss drugs. Conversely, competitor Novo Nordisk’s shares dropped sharply after the company surprised investors by projecting a significant decline in sales.
Overall, despite the challenges presented by AI uncertainties and economic indicators, the market has shown resilience in sectors outside of technology, indicating potential opportunities for investors willing to navigate this turbulent landscape.