Jamie Spencer
What Happened
US stocks wavered on Thursday, pulling back from a record-setting streak as enthusiasm around artificial intelligence (AI) cooled and investors awaited further details on President Donald Trump’s trade policies.
Market Performance
- S&P 500 (^GSPC): Rose slightly above the flatline after a three-day winning streak that pushed it near record highs.
- Dow Jones Industrial Average (^DJI): Gained 0.3%, remaining within reach of an all-time high.
- Nasdaq Composite (^IXIC): Fell 0.2% as tech stocks struggled, led by a decline in Nvidia (NVDA).
Key Drivers
- AI Stocks Dip: Nvidia shares slipped after its supplier, SK Hynix, signaled uncertainty in chip demand for the year.
- Trump’s Trade Policy: Investors await his virtual address at the World Economic Forum in Davos for clarity on planned tariffs, which could impact inflation and stock markets.
- Earnings Reports: Netflix (NFLX) set a positive tone for earnings season, while GE Aerospace (GE) surged on a $7 billion share buyback plan.
Economic Data
- US Jobless Claims: Increased by 6,000 to 223,000, slightly above expectations of 220,000.
- Airline Stocks: American Airlines (AAL) declined on a weak 2025 profit outlook, while Alaska Airlines (ALK) rose after forecasting a smaller-than-expected Q1 loss.
Outlook
Traders are closely monitoring upcoming earnings and Trump’s trade policies, particularly the timing of proposed tariffs on major trading partners. AI stocks remain under pressure, but positive corporate earnings could provide support for equities in the near term.
