Indexes end lower
The S&P 500 fell 0.28 percent Wednesday to close at 6,637.97, while the Nasdaq Composite lost 0.34 percent to finish at 22,497.86. The Dow Jones Industrial Average declined 171.50 points, or 0.37 percent, ending at 46,121.28. The pullback marked a second consecutive day of losses tied to concerns over the sustainability of the artificial intelligence rally.
AI stocks face pressure
Nvidia dropped nearly 1 percent, extending its slide after unveiling a $100 billion deal with OpenAI that stirred worries about circular investments within the AI industry. Oracle also fell for a second session, losing close to 2 percent. Micron Technology slipped almost 3 percent after its earnings and outlook disappointed investors. The cautious mood underscored questions about whether lofty valuations in the AI trade are justified.
Intel bucks the trend
The Nasdaq’s losses narrowed late in the session as Intel surged more than 6 percent. Reports from Bloomberg suggested Apple may invest in the chipmaker, days after Nvidia announced a $5 billion investment. The potential backing highlighted Intel’s shifting role as it seeks to recover market share and secure a place in the AI hardware race.
Valuation concerns and macro risks
Market watchers suggested that recent weakness may reflect profit-taking. Federal Reserve Chair Jerome Powell pointed out stretched equity valuations earlier this week. “Tech is probably a little bit extended,” said Jay Hatfield of Infrastructure Capital Advisors, noting seasonal patterns could keep pressure on stocks. Despite the pullback, the S&P 500 remains nearly 3 percent higher this month, outpacing the average September decline of 4.2 percent in the past five years.
Looking ahead
Investors remain cautious ahead of Thursday’s jobless claims data and Friday’s release of the Fed’s preferred inflation measure, the PCE index. Political uncertainty also looms, with the risk of a government shutdown growing after President Donald Trump canceled a meeting with congressional leaders aimed at avoiding a September 30 funding lapse.
