Tech Selloff Hits Stocks as AI Doubts Resurface – US Market Wrap
Stocks fell, yields rose, oil climbed above $111, and the dollar was steady as pressure on tech weighed on sentiment.
A selloff in technology giants dragged equities lower as concerns grew over whether massive AI investments will deliver returns, following reports OpenAI missed user and sales targets, raising doubts about its ability to sustain infrastructure spending. Partners including Oracle and CoreWeave dropped, with the S&P 500 pulling back from a record and the Nasdaq 100 falling 1%.
The weakness came ahead of key earnings from megacap names including Alphabet, Microsoft, Amazon, Meta, and Apple. OpenAI pushed back on the concerns, saying its business remains strong despite rising competition from Anthropic.
Brent rose above $111 on fears a prolonged peace process could keep the Strait of Hormuz closed. Trump said Iran has asked the US to lift the naval blockade during negotiations, with reports Tehran may submit a revised proposal soon.
Concerns over inflation alongside a resilient labor market are expected to keep the Fed on hold for a third straight meeting, with short-dated Treasuries falling. Separately, JPMorgan CEO Dimon warned a potential credit downturn could be worse than expected despite strong bank earnings.
