Traders work on the floor of the New York Stock Exchange (NYSE) in New York, US, on Thursday, Nov. 13, 2025.<\/p>\n
Michael Nagle | Bloomberg | Getty Images<\/p>\n
Stocks retreated on Thursday, with technology stocks weighing on the major averages even as a broader rotation occurs beneath the surface. Investors also grew pessimistic about the interest rate outlook, even as the U.S. government reopens after a record-setting shutdown.<\/p>\n
The Dow Jones Industrial Average<\/a> lost 504 points, or 1.1%, pulling back from its record highs seen in the previous session<\/a>. The S&P 500<\/a> shed 1.4%, with declines in the communication services and information technology sectors leading the way. The Nasdaq Composite<\/a> pulled back 2.2%.<\/p>\n Investors continued to sell shares of technology companies, especially those in the artificial intelligence trade, amid worries about their valuations<\/a>. Despite the Nasdaq starting off the week strong<\/a>, the tech-heavy index was on track to close with a third straight day of losses Thursday, weighed down by heavyweights Nvidia<\/a>, Broadcom<\/a> and Alphabet<\/a>.<\/p>\n “It seems like a natural consolidation to me,” Ron Albahary, chief investment officer at Laird Norton Wealth Management, said to CNBC, calling the day’s pullback “healthy.” “Part of the, I think, AI narrative is that at some point all this [capital expenditure] is going to actually manifest itself. The benefits of it will manifest itself within the broader economy, so if you start seeing health care and manufacturing, industrials start to actually benefit from AI, that supports the overarching narrative, which is AI capex is going to enhance productivity across the board.”<\/p>\n A sudden change in the interest rate outlook weighed on equities as well. Markets were last pricing in a more than 49% chance that the data-dependent Federal Reserve will indeed cut its benchmark overnight borrowing rate at its last meeting of the year in December. That marks a sharp drop from the 62.9% likelihood that markets priced in a day ago, according to the CME FedWatch Tool<\/a>.<\/p>\n The central bank had been flying blind in the midst of the longest-ever government shutdown, as it was without key economic reports, such as the October jobs report and inflation data. White House press secretary Karoline Leavitt said on Wednesday that these reports may ultimately never be released<\/a>, and that the shutdown could lower fourth-quarter economic growth by up to 2 percentage points. Most economists expect minimal impact to U.S. GDP, however.<\/p>\n