The U.S. stock market stumbled Tuesday as a once-relentless, tech-driven rally showed signs of fatigue, with investors growing increasingly cautious about the strength of the artificial intelligence boom and the broader economic outlook.
The S&P 500 fell roughly 0.8%, marking its fourth consecutive day of losses. The Dow Jones Industrial Average dropped nearly 500 points, or more than 1%, while the Nasdaq Composite slid 1.2%, extending a multi-day pullback in the market’s most heavily weighted technology names.
The sell-off comes at a pivotal moment for market sentiment. A long-delayed U.S. jobs report is finally set for release in the coming days, after weeks of uncertainty tied to government data disruptions. The report is expected to play a crucial role in shaping expectations for the Federal Reserve’s next policy steps.
Investors are also positioning ahead of high-stakes earnings from Nvidia, the company that in many ways has become the face of the AI investment boom. Nvidia’s results are widely viewed as a key barometer of whether the sector’s soaring valuations can be justified by real revenue and profit growth. Any sign of slowdown could ripple across the broader tech landscape.
For months, major indexes have been buoyed by a narrow group of high-growth technology stocks, particularly those tied to AI infrastructure and chipmaking. Tuesday’s declines suggest that confidence in that trade may be wavering, as traders reassess how much optimism is already priced in—and how much risk remains if growth disappoints.
While the broader economy has remained resilient, the combination of delayed economic data, elevated interest rates, and questions about the durability of the AI boom has injected a new level of unease into markets. Tuesday’s losses reflect that shift.
Whether this week’s crucial data and earnings releases reassure investors or deepen the pullback could determine the market’s direction into year-end.
