More drops for technology stocks weigh on Wall Street

Tech Stocks Drag Wall Street Lower as Market Faces Mixed Results

Technology stocks continued their downward trajectory on Wednesday, weighing heavily on U.S. markets despite broader market participation. The S&P 500 fell 0.5%, marking its fifth modest loss in six days, while the Nasdaq composite sank 1.5%. The Dow Jones Industrial Average bucked the trend, rising 260 points or 0.5%.

Although more than twice as many stocks rose than fell within the S&P 500, the technology sector’s struggles overshadowed these gains for a second consecutive day.

Advanced Micro Devices (AMD) exemplified the tech sector’s challenges, plunging 17.3% despite reporting stronger-than-expected quarterly profits. The chip manufacturer also provided an optimistic revenue forecast for early 2026 that exceeded analysts’ expectations, but investors appeared unimpressed after the stock had doubled over the previous 12 months.

The broader tech sector has come under increasing scrutiny as valuations have soared. Even companies delivering positive earnings surprises are facing investor skepticism, with many questioning whether Big Tech stocks have become overvalued after years of market dominance. Software developers face additional pressure from concerns about potential displacement by artificial intelligence-powered competitors.

Uber Technologies contributed to market weakness, falling 5.1% after reporting quarterly results that missed analysts’ expectations. The ride-hailing giant also provided lower-than-anticipated profit guidance for the current quarter while announcing a new chief financial officer.

However, not all tech stocks suffered. Super Micro Computer surged 13.8% after exceeding profit expectations for the quarter. The company, which supplies AI servers and related equipment, has benefited from the ongoing artificial intelligence boom.

Outside the tech sector, pharmaceutical giant Eli Lilly rallied 10.3% after surpassing quarterly profit expectations. The company continues to ride strong growth from its popular Mounjaro and Zepbound products for diabetes and weight management.

Match Group climbed 5.9% after beating analysts’ expectations and increasing its dividend. The dating app company credited early signs of success from user experience improvements, including a new facial verification feature for Tinder that has significantly reduced interactions with “bad actors” in regions where it has been implemented.

Walmart edged up 0.2%, a day after its market capitalization surpassed $1 trillion for the first time. The retail giant joins an exclusive club dominated by technology companies like Nvidia and Apple, which are each valued above $4 trillion.

In precious metals markets, gold and silver prices recovered partially after recent volatility. Gold added 0.3% to settle at $4,950.80 per ounce after briefly climbing above $5,000. The metal has experienced dramatic swings after approximately doubling in price over the past year, approaching $5,600 last week before dropping below $4,500 on Monday. Silver, which has been even more volatile, rose 1.3%.

Investors have flocked to precious metals amid concerns about tariffs, a weakening U.S. dollar, and growing government debt burdens worldwide. Critics, however, argue that prices rose too rapidly and were due for correction.

In economic news, mixed data provided little clear direction. ADP Research reported that private-sector hiring fell short of economists’ expectations in January. Meanwhile, the Institute for Supply Management indicated that growth in U.S. services businesses continued at the anticipated pace, though prices paid by these businesses accelerated, potentially signaling inflationary pressure.

Bond markets remained relatively stable, with the 10-year Treasury yield edging down slightly to 4.27% from 4.28% the previous day.

Global markets delivered mixed results. Japan’s Nikkei 225 fell 0.8% from its all-time high, with Nintendo dropping 11% despite strong profits as investors worried about sustaining sales momentum for its Switch 2 console. South Korea’s Kospi climbed 1.6% to reach another record.