US Stocks-Wall Street ends down, calls for AI slowdown pummel chipmakers

The S&P 500 declined 0.48% to end the session at 7,619.94 points. The Nasdaq declined 0.56% to 26,186.41 points, while the Dow Jones Industrial Average declined 0.29% to 52,421.17 points. Eight of the 11 S&P 500 sector indexes declined, led lower by information technology .SPLRCT, down 1.68%, followed by a 1.44% loss in industrials .SPLRCI. Volume on U.S. exchanges was relatively heavy, with 15.3 billion shares traded, compared to an average of 14.8 billion shares over the previous 20 sessions. ServiceNow NOW.N, Adobe ADBE.O and Workday WDAY.O rallied between 4% and 7.4%. Those and other software stocks have sold off in recent sessions over worries that competition from AI companies could hurt their margins. Bank of America BAC.N tumbled 5.1% after CEO Brian Moynihan said he expects investment banking fees to drop by at least 10% in the third quarter. The S&P 500's recent decline, coupled with a strong earnings outlook, has the benchmark trading at 19 times expected earnings. That is its cheapest since April 2025, when U.S. President Donald Trump's "Liberation Day" tariff announcements threw global markets into a tailspin. Advancing issues outnumbered falling ones within the S&P 500 .AD.SPX by a 1.3-to-one ratio. The S&P 500 posted 10 new highs and nine new lows; the Nasdaq recorded 47 new highs and 202 new lows. Shares of Nvidia NVDA.O declined 3.4%, while Micron Technology MU.O dropped over 5%. Broadcom AVGO.O and Advanced Micro Devices AMD.O each fell over 4%. The PHLX chip index .SOX tumbled 5.9%, reducing its 2026 gain to 57%. Brent crude futures LCOc1 settled 1% higher at $105.68 per barrel as worries about energy supplies mounted following new strikes on Saudi Arabian energy infrastructure and attacks on ships in the Middle East. High inflation, heavy corporate and government borrowing and concerns about the long-term U.S. fiscal trajectory have sent U.S. Treasury yields higher in the past month. The 5% mark that the 10-year yield hit on Monday is a threshold that analysts warned could ripple through the U.S. economy and threaten the bull market in stocks by denting the relative appeal of U.S. equities. Traders are pricing in a 90% chance that the Fed will raise interest rates by 25 basis points at its policy meeting on Wednesday to fight inflation related to high oil prices, according to CME's FedWatch. "The 10-year going above 5% is huge and speaks volumes, and it may pressure the Fed to do more than just one rate hike," said Jake Dollarhide, CEO of Longbow Asset Management. Wall Street ended down on Monday, weighed down by losses in Nvidia and other chipmakers after top executives in U.S. artificial intelligence companies raised safety concerns and called for a slowdown in the development of AI. Investors were also jittery after the benchmark 10-year Treasury yield briefly surpassed 5% for the first time since 2023 ahead of this week's Federal Reserve meeting. The U.S. central bank is widely expected to raise interest rates. AI-linked stocks plunged worldwide after the leaders of Anthropic, OpenAI and xAI warned of risks from rapid development, the starkest threat yet to the billions of dollars being poured into the industry that have driven markets to record highs.

US Stocks-Wall Street ends down, calls for AI slowdown pummel chipmakers

Major index and sector moves

Other notable stock moves and valuation

Chipmakers and rates pressure the market

Wall Street ends lower as chipmakers sell off

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