Wall Street opened Thursday on a cautious note, with S&P 500 and Nasdaq futures sliding as investors shunned risk amid a cascade of disappointing tech earnings, a renewed crypto slump, and weakness in precious metals.
Futures tied to the S&P 500 fell 0.5%, while Nasdaq 100 futures dropped 0.7%, reflecting continued anxiety over the tech sector. Dow Jones futures gave up 130 points, or 0.3%, as the market weighed mixed signals across sectors.
Tech Under Pressure
The so-called Magnificent Seven tech giants remain in focus. Alphabet’s recent earnings report rattled markets, as the company forecasted up to $185 billion in AI-driven capital expenditures in 2026, spooking investors who fear elevated spending could weigh on profitability. Shares dropped 3% in premarket trading.
Meanwhile, Qualcomm slid 11% after warning that a global memory shortage would pressure growth, intensifying the sector-wide rout. The sell-off has been particularly acute in software and chip stocks, with fears over AI disruption pushing investors to rotate into safer, more attractively valued areas.
“I would say that there’s a lot that’s been sold out,” said Sonali Basak, chief investment strategist at iCapital. “And there are software players, particularly the incumbents, that will win at the end, that are worth looking at soon, if not now.”
Crypto and Metals Follow the Downtrend
The cryptocurrency market continued its downward spiral, with Bitcoin dipping below $70,000, a key support level. Precious metals also struggled: silver snapped a two-day rebound, plunging as much as 16%, after suffering a near 30% drop last Friday.
The moves highlight heightened risk aversion, with investors seeking safer harbors amid volatile market conditions.
Labor Market Adds to the Mood
Adding to investor unease, Challenger, Gray & Christmas reported 108,435 layoffs in January, marking the highest January total since the global financial crisis, signaling that broader economic pressures are still present despite some pockets of resilience.
Mixed Market Signals
Despite the pullback, the broader market shows signs of selective resilience. The 30-stock Dow Jones Industrial Average added 260 points, or 0.5%, while the equal-weighted S&P 500 gained 0.9%, suggesting that not all areas of the market are under pressure.
For now, traders are weighing whether the recent turbulence represents overdone selling or the start of a more prolonged correction. Many analysts, including Basak, see buy-the-dip opportunities in select tech and software stocks, particularly among established incumbents poised to thrive in the evolving AI landscape.