S&P 500 (^GSPC 0.84%) fell 0.84% to 6,917.81 and the Nasdaq Composite (^IXIC 1.43%) dropped 1.43% to 23,255.19 amid tech weakness. The Dow Jones Industrial Average (^DJI 0.34%) slipped 0.34% to 49,240.99 after touching a record intraday high.
Market movers
Walmart (WMT +3.04%) outperformed as it crossed the $1 trillion market-cap mark for the first time. PepsiCo (PEP +5.06%) gained on an earnings beat, closing up 4.93% at $162.85.
But it was software and fintechs like PayPal (PYPL 20.11%) and Gartner (IT 20.87%) that led the wider fall. Both slid dramatically on earnings disappointments. Other software stocks, such as Salesforce (CRM 6.98%) also tumbled. That said, Palantir Technologies (PLTR +6.75%) jumped after posting robust AI-driven revenue growth yesterday.
What this means for investors
Tech stocks led the drawdown today as big names such as Nvidia (NVDA 2.82%), Microsoft (MSFT 2.86%), and Amazon (AMZN 1.73%) all lost ground. In addition to AI bubble and over-concentration concerns, new announcements from AI startup Anthropic put further automation pressure on software stocks.
Today’s gainers included big retailers such as Walmart, Costco (COST +1.00%), and Target (TGT +1.61%). This suggests that investors are rotating out of high-risk growth stocks and into value investments.
Reports that the U.S. Navy had shot down an Iranian drone fueled fears of heightened tensions in the Middle East and caused oil prices to spike. Brent crude rose 2.58% to $68.01 a barrel. Meanwhile, the 10-year Treasury hit a multi-month high as bond yields rose in both the U.S. and Europe.
