A trader works on the floor of the New York Stock Exchange.
NYSE
U.S. stocks retreated on Thursday as names in the artificial intelligence trade came under pressure yet again amid worries around eye-watering valuations.
The Dow Jones Industrial Average slipped 455 points, or 1%. The S&P 500 traded down by 1.2%, while the Nasdaq Composite shed 1.9%.
AI stocks remained in focus for those on Wall Street during the session. Qualcomm shed 4%, even after the chipmaker posted better-than-expected quarterly results. Advanced Micro Devices, a standout name in the prior day, declined 7%, while Palantir Technologies and Oracle dipped 4% and 3%, respectively. Shares of AI darling Nvidia and fellow “Magnificent Seven” name Meta Platforms slid as well.
However, Marvell Technology was a winner, with shares moving almost 1% higher following a report that Softbank had thought about a potential takeover of the chipmaker.
Equities linked to the AI space rebounded on Wednesday from valuation concerns that swirled earlier this week, serving as a potential boon for the major indexes. AMD closed more than 2% higher in the previous session after the semiconductor company reported better-than-expected third-quarter results. The performance pulled up some other AI stocks alongside it, including Broadcom and Micron Technology. Oracle also recouped some recent losses.
While the recovery of the AI names helped the market bounce back a bit following a soft start to the weekly period, all three major U.S. indexes are still firmly in the red week to date.
“We’re still very early in the AI super-cycle,” Dynasty Financial Partners’ Shirl Penney told CNBC’s “Closing Bell” on Wednesday. “There’s going to be continued significant capex, not just with some of the ‘Mag Seven,’ but also you see it with large financial firms like Schwab, JPMorgan and others.”
Thursday’s pullback was exacerbated by concerns about the state of the labor market, as October saw a significant number of layoff announcements. Job cuts for the month totaled 153,074, marking an increase of 183% from September and 175% from the year-ago period, according to Challenger, Gray & Christmas. That’s the highest level recorded for an October in 22 years. Not only that, 2025 is the worst year for layoffs since 2009.
That data paints a shaky picture of the U.S. economy, particularly in light of the lack of data releases with the ongoing U.S. government shutdown. The stoppage, now in its 37th day, has become the longest in the country’s history.
Investors were also looking at Washington, as the Supreme Court heard arguments over the legality of the Trump administration’s tariffs. They increasingly expect the Supreme Court to rule against the Trump administration’s aggressive trade policy after high court justices on Wednesday expressed some skepticism about the trade taxes’ legality.
The potential ruling would trigger a rollback of the president’s tariffs, likely pushing stocks higher.