Chipmakers Sink as Nvidia Fails to Dispel AI Worry: Markets Wrap
(Bloomberg) — A rout in chipmakers weighed on stocks as Nvidia Corp.’s results failed to inspire investors seeking reassurances about the artificial-intelligence outlook. Oil climbed as Iran said nuclear talks with the US were intense, spurring a flight to the perceived safety of bonds.
While most shares in the S&P 500 rose, the benchmark fell. The Nasdaq 100 lost 1.6%. Even after giving a bullish forecast, Nvidia sank 4%, dragging down every company in a closely watched semiconductor gauge. Salesforce Inc. gave a strong estimate for long-term sales and announced a large share buyback, assuaging some fears about AI disruption of the software industry.
The mixed Wall Street response reflects uncertainties swirling around the revolutionary technology. After soaring for much of the past few years, Nvidia has gone cold amid questions about massive AI spending. Meanwhile, traders have been fleeing companies seen as potentially under threat of being displaced.
The reason why investors didn’t launch into a frenzy after seeing revenue, net income, and guidance come in way better than expected is that Nvidia rarely misses on those metrics, according to Hardika Singh at Fundstrat Global Advisors.
“But where it did miss was easing investors’ concerns about its narrowing moat in the evolving world of compute and explaining its gameplan for how it’ll fare in a world of AI disruption that could upend all kinds of businesses from cybersecurity to food delivery to banks,” she said.
Michael Burry, who made his name shorting the US housing market, added to the worries. He noted that Nvidia has purchase obligations of $95.2 billion, compared with $16.1 billion a year earlier. That could be risky if demand wavers.
On the economic front, jobless claims rose by less than expected, indicating that layoffs remain relatively low. For the first time since 2022, the average 30-year mortgage rate slipped below 6%.
The S&P 500 lost 1%. The yield on 10-year Treasuries fell three basis points to 4.02%. Oil topped $66.
Nvidia’s earnings and guidance were good, but there are still some questions about whether the firm can maintain its huge gross margins going forward, according to Matt Maley at Miller Tabak.
As we move into March, he sees a few issues that could create some headwinds. Whether it be anxiety over AI profitability, worries over the impact of that technology on several sectors or concerns surrounding the private-credit market, Maley said there are plenty of reasons to think next month will be a rough one for stocks.
“However, momentum is a very powerful force in the marketplace,” he added. “So, if we can see a further advance as we move into March, we might finally see the broad market experience another rally leg off of the 2022 bear-market lows.”
Corporate Highlights:
Warner Bros. Discovery Inc. reported lower fourth-quarter sales and earnings, underscoring the challenges the media giant is confronting as it weighs competing takeover bids from rival entertainment companies. Hertz Global Holdings Inc. reported a fourth-quarter loss that was worse than expected as the company said the government shutdown and softer used-car prices both affected results late in the year. JM Smucker Co. said two new directors will be joining its board as part of an agreement reached with activist investor Elliott Investment Management. Celsius Holdings Inc. posted sales which more than doubled from a year earlier following its acquisition of Alani Nu. What Bloomberg Strategists say…
“This earnings season has offered plenty of evidence that the price action has overshot fundamentals. However, none of that matters because not even good news can lift up sentiment — and that’s a dangerous zone for stocks be in. The threat is that risk aversion now spills into the broader market, not just tech.”
—Tatiana Darie, Macro Strategist, Markets Live. For the full analysis, click here.
Some of the main moves in markets:
Stocks
The S&P 500 fell 1% as of 12:30 p.m. New York time The Nasdaq 100 fell 1.6% The Dow Jones Industrial Average fell 0.3% The MSCI World Index fell 0.7% Currencies
The Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.3% to $1.1778 The British pound fell 0.6% to $1.3472 The Japanese yen was unchanged at 156.37 per dollar Cryptocurrencies
Bitcoin fell 2.9% to $66,964.23 Ether fell 5.2% to $1,991.95 Bonds
The yield on 10-year Treasuries declined three basis points to 4.02% Germany’s 10-year yield declined two basis points to 2.69% Britain’s 10-year yield declined four basis points to 4.27% Commodities
West Texas Intermediate crude rose 1.6% to $66.45 a barrel Spot gold rose 0.2% to $5,175.44 an ounce ©2026 Bloomberg L.P.
