The Nasdaq and S&P 500 fell on Monday as caution around artificial intelligence weighed on technology stocks. Investors are focusing on Nvidia’s upcoming earnings report. Nvidia has beaten analysts’ revenue expectations for nine straight quarters.
But the recent caution around AI technology investments added to the market’s uncertainty. The Nasdaq closed down 1.21% and the S&P 500 decreased by 0.50%. The Dow Jones Industrial Average saw a slight increase of 0.08%.
Nike gained after being upgraded to “buy” by Jefferies. Berkshire Hathaway reached a record high following strong fourth quarter performance. Major tech players Nvidia and Microsoft closed lower.
Microsoft shares declined after it reportedly canceled some data center leases amid an $80 billion push into AI. The S&P 500’s tech sector was down 1.2%, followed by consumer discretionary with a decline of 0.9%.
Market cautions impact tech stocks
The communication services sector was down 0.5%. All three sectors contain members of the Magnificent Seven group of megacap technology stocks. This widespread sell-off highlights growing apprehension among investors regarding the future profitability and stability of tech companies.
Particularly those heavily involved in AI development and data management. As the market reacts to these uncertainties, investors are keeping a close eye on additional data and forecasts. These may influence future trading decisions in the tech landscape.
In related news, the Bank of England’s recent interest rate cut and updated economic forecasts have sparked diverse opinions. Analysts have differing views about the future direction of monetary policy. Other key economic events this week include the January report for the Personal Consumption Expenditure index on Friday.
This is the Federal Reserve’s preferred measure of inflation. Reports on US GDP, the housing market, and consumer confidence are also due in the coming days.
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