Highlights
Technology stock losses depressed the S&P 500 and the Nasdaq Wednesday while the value/cyclical shares fared better as rotation out of tech stocks continued. The Dow Jones industrial average firmed 0.5 percent, the S&P 500 lost 0.5 percent and the Nasdaq was down 1.5 percent. US Treasury yields fell, oil prices rebounded, and the dollar was mostly lower versus major currency pairs.
Chipmakers and software companies led the declines in tech stocks as the AI trade that has boosted Nvidia and other chipmakers still appears overdone. Non-tech sectors were buoyed by asset reallocation as they appear relatively cheap. Software sold off for a second day on the worry that AI will cannibalize software company business. On the positive side, Amgen led biotechnology shares higher after better than expected quarterly results.
Definition
Market Reflections track market reaction to the trading day's major events. Economic data, policymaker speeches, and company news are featured in this report as well as key indexes and financial instruments.
Description
Understanding why markets respond as they do is fundamental for an investor. Market Reflections help explain how the day's events, news, and data impact the outlook for the economy and for market prices.