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\n Tech stocks were under pressure this week as Wall Street\u2019s AI enthusiasm slowed and investors adjusted portfolios after a strong summer rally.\n <\/p>\n
\n The Nasdaq Composite fell 0.67% on Wednesday after sliding 1.46% on Tuesday. The tech-heavy index was on track to snap back-to-back weeks of gains.\n <\/p>\n
\n Meanwhile, the broader S&P 500 fell 0.24% and posted its fourth day of losses in a row. The Dow hovered around the flatline.\n <\/p>\n
\n Tech stocks had steadily rallied in recent months, lifting the S&P 500 and Nasdaq to a streak of record highs<\/a>. Now Wall Street is taking a breather while optimism about the AI boom is facing some friction.\n <\/p>\n \n Palantir (PLTR<\/a>), a star of the AI trade, fell 1.1% on Wednesday after falling 9.35% on Tuesday. Meanwhile, Nvidia (NVDA<\/a>) edged lower by 0.14% on Wednesday after sliding 3.5% on Tuesday.\n <\/p>\n \n \u201cInvestors rotated out of high-momentum tech stocks, reflecting renewed jitters over the sustainability of the AI trade,\u201d Ulrike Hoffmann-Buchardi, head of global equities at UBS, said in a note.\n <\/p>\n \n Investors are also in wait-and-see mode ahead of a critical day for markets on Friday when Federal Reserve Chair Jerome Powell is set to deliver remarks at the Jackson Hole Economic Symposium.\n <\/p>\n \n \u201cIt\u2019s just a pause that may refresh as investors retrench and rethink how they want to position their tech dollars,\u201d Rob Haworth, senior investment strategy director at US Bank Asset Management Group, told CNN.\n <\/p>\n \n Powell\u2019s closely watched speech on Friday could provide signals about the Fed\u2019s potential rate-cutting path and comes at a key inflection points for markets after past months\u2019 ascent to record highs.\n <\/p>\n \n Excitement about AI propelled markets higher in recent months, boosted by robust corporate earnings and enormous spending by companies like Meta and Microsoft.\n <\/p>\n \n But Wall Street\u2019s eagerness was tested this week after Sam Altman, chief executive at OpenAI, said he thinks the market might be in a bubble.\n <\/p>\n \n \u201cAre we in a phase where investors as a whole are overexcited about AI? My opinion is yes,\u201d Altman told reporters last week, according to The Verge<\/a>.\n <\/p>\n \n The OpenAI chief also said he thinks AI will provide value for the economy. \u201cIs AI the most important thing to happen in a very long time? My opinion is also yes,\u201d he said.\n <\/p>\n \n Also, researchers at MIT on Monday published a report detailing how the majority of companies testing new generative AI tools are seeing zero returns.\n <\/p>\n \n While there was not an explicit catalyst for the decline of tech and AI stocks decline this week, investors said Altman\u2019s comments and the MIT report could be contributing to negative momentum.\n <\/p>\n \n AI chip and semiconductor companies Advanced Micro Devices (AMD<\/a>) and Marvell Technology (MRVL<\/a>) were each down almost 7% this week.\n <\/p>\n \n \u201cAltman\u2019s comments spooked some people when he talked about the AI bubble,\u201d Dan Ives, head of global technology research at Wedbush Securities, told CNN.\n <\/p>\n \n \u201cTech stocks have had a massive run, so I think it\u2019s just typical that investors are starting to take some chips off the table going into Labor Day,\u201d Ives said. \u201cBut I believe it\u2019s going to be short lived.\u201d\n <\/p>\n \n Each of the Magnificent Seven tech stocks \u2014 Apple (AAPL<\/a>), Alphabet (GOOGL<\/a>), Amazon (AMZN<\/a>), Meta (META<\/a>), Microsoft (MSFT<\/a>), Nvidia (NVDA<\/a>) and Tesla (TSLA<\/a>) \u2014 fell on both Tuesday and Wednesday, dragging down the broader market.\n <\/p>\n \n As of Tuesday, they made up 33.5% of the S&P 500\u2019s total market value, according to S&P Dow Jones Indices, reflecting their outsized influence on the index\u2019s performance.\n <\/p>\n \n \u201cStocks have been on an absolute tear. Valuations have sprinted up,\u201d said Ross Mayfield, an investment strategist at Baird. \u201cThe fundamentals are good but not keeping pace with the price action.\u201d\n <\/p>\n \n \u201cI think along the way we\u2019ll see pockets of profit taking, even if it doesn\u2019t mark the end of the bull market in general,\u201d Mayfield said.\n <\/p>\n \n While tech dragged on the market, about 70% of stocks in the S&P 500 had closed higher on Tuesday, UBS\u2019 Hoffmann-Buchardi said. Sectors that outperformed included consumer staples, utilities and real estate.\n <\/p>\n \n It\u2019s a sign that investors are shifting out of Big Tech and AI-related trades and toward more defensive stocks as they reassess the markets. Nvidia as of Monday had surged 93% since a low point in early April.\n <\/p>\n \n \u201cWe\u2019ve been expecting this type of a pullback,\u201d said Jay Hatfield, chief executive at Infrastructure Capital Advisors, who said he has taken down his exposure to tech in recent months.\n <\/p>\n \n It\u2019s also the start of a historically weak season for stocks, Hatfield said. \u201cWe\u2019re neutral on the market right now, but still really bullish for year end.\u201d\n <\/p>\n \n Palantir is still up 106% this year. But shares in Palantir are down six days in a row and had dropped as much as 9.8% on Wednesday before paring losses, reflecting the volatility in AI stocks.\n <\/p>\n \n \u201cNow we\u2019re getting the downward momentum,\u201d Hatfield said. \u201cPalantir is like the poster child for excessive valuation, and those investors are learning that the momentum works in both directions.\u201d\n <\/p>\n","protected":false},"excerpt":{"rendered":"Facebook Tweet Email Link New York \u00a0\u2014\u00a0 Tech stocks were under pressure this week as Wall Street\u2019s AI…\n","protected":false},"author":2,"featured_media":98021,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[45],"tags":[182,181,507,74],"class_list":["post-98020","post","type-post","status-publish","format-standard","has-post-thumbnail","category-artificial-intelligence","tag-ai","tag-artificial-intelligence","tag-artificialintelligence","tag-technology"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/98020","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/comments?post=98020"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/posts\/98020\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media\/98021"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/media?parent=98020"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/categories?post=98020"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/us\/wp-json\/wp\/v2\/tags?post=98020"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}![\"Open](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/08\/gettyimages-2218344212.jpg\")
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