Tech stocks tumble, Nasdaq falls 2% as AI rally cools

U.S. stock futures were mixed on Wednesday, with the Dow inching up 0.1% while the S&P 500 dipped 0.1%. The tech-heavy Nasdaq 100 fell 0.3%, signaling continued pressure after a sharp sell-off the previous day. This comes after the Nasdaq Composite plummeted over 2% on Tuesday.

The downturn was led by a slump in major tech stocks. AI chipmaker AMD saw its shares fall over 3% after its fourth-quarter guidance failed to impress investors. This followed a nearly 8% plunge in Palantir, which fell despite solid earnings, as investors questioned its lofty valuation and broader fears of an AI bubble mounted.

Compare Top Forex and Crypto brokers and start trading and investing with a trusted partner

Globally, Asian markets mirrored the sell-off. South Korea’s Kospi fell 2.85%, and Japan’s Nikkei 225 dropped 2.8%. In other markets, gold struggled to hold the $4,000 level, steadying near $3,937 an ounce after a recent 2% decline.

Looking ahead, traders are focused on earnings from companies like McDonald’s and Robinhood, plus the ADP private payrolls report for clues on the labor market. Meanwhile, the ongoing government shutdown is poised to become the longest in history, and the Supreme Court is set to hear a critical case challenging former President Trump’s authority to impose tariffs.