US Stocks Retreat Amid AI Optimism Fade and Tariff Uncertainty
U.S. equities experienced a pullback on Thursday, as optimism in artificial intelligence (AI) waned and investors awaited further information on President Donald Trump's tariff plans.
S&P 500 Hovers Near Record
The S&P 500 (^GSPC) remained virtually unchanged, after a three-day winning streak that brought the index close to an all-time high on Wednesday.
Dow Jones Inches Higher
The Dow Jones Industrial Average (^DJI) gained 0.2%, approaching its own record.
Nasdaq Composite Dives
The Nasdaq Composite (^IXIC) declined 0.4%, as tech stocks struggled to maintain the momentum that drove gains on the previous day. Nvidia (NVDA) stocks fell, along with fellow megacap techs Apple (AAPL) and Google-parent Alphabet (GOOG, GOOGL).
Tariff Concerns Linger
Investors remain cautious about Trump's trade policy, which initially boosted tech stocks but left uncertainty regarding tariffs on major trading partners. Investors are anticipating Trump's speech at the World Economic Forum in Davos for additional insights.
Amazon and Tesla Trim
Shares in Amazon (AMZN) and Tesla (TSLA) declined slightly after the companies announced business shifts in Canada, a potential target for Trump's tariffs. Amazon will close warehouses in Quebec, eliminating 1,700 jobs, while Tesla plans price increases for its EVs sold in Canada.
Earnings Reports
Earnings reports are expected to buoy markets, following Netflix's positive tone on Wednesday. GE Aerospace (GE) shares rose after the jet engine maker increased its share buyback program to $7 billion. American Airlines (AAL) stock fell after a disappointing 2025 profit forecast, while Alaska Airlines (ALK) rose on a smaller-than-expected first-quarter loss projection.
Economic Data
US jobless claims increased by 6,000 to 223,000 for the week ending January 18th, surpassing analysts' expectations of 220,000.
Individual Stock News
* American Airlines (AAL): Stock tumbles 8% after forecasting a surprise quarterly loss.
* Electronic Arts (EA): Stock drops 15% on reduced bookings outlook.
* Nvidia (NVDA): Stock declines amid tech sector pullback.