Stock Market Today, Feb. 4: AMD Plunges Over 17% As Tech Fallout Continues
The S&P 500 (SNPINDEX:^GSPC) fell 0.51% to 6,882.72, the Nasdaq Composite (NASDAQINDEX:^IXIC) slid 1.51% to 22,904.58 on heavy tech selling. The Dow Jones Industrial Average (DJINDICES:^DJI) rose 0.53% to 49,501.30 as investors rotated into defensive and value names.
Market movers
Advanced Micro Devices (NASDAQ:AMD) sank 17.31% despite solid earnings, finishing the day at $200.19. The market had high expectations, and investors felt the company’s Q1 forecast came up short.
Software stocks continued to tumble, with intraday drops from big names, including Thomson Reuters (NASDAQ:TRI) which is down over 20% in the past five days. In contrast, biopharmaceutical company Amgen, (NASDAQ:AMGN), gained over 8% on positive Q4 results, helping to push the Dow into positive territory.
What this means for investors
The Nasdaq continued to plummet today, with AI skepticism reflected in the steep AMD sell-off. SanDisk (NASDAQ:SNDK) finished the day down by almost 16%, erasing some of its recent gains.
Anthropic’s release of new AI tools is pressuring software and services companies. Concern that it could automate a host of jobs offered by companies wiped around $300 billion off software and financial services stocks yesterday, per The Wall Street Journal.
Tech upheaval means capital is rotating towards defensive and cyclical stocks, as shown by today’s Dow gains. Disappointing jobs data from ADP did little to reassure investors. The payroll processor said today that private payrolls added 22,000 jobs in January, far below the predicted 45,000 positions. Ongoing uncertainty is likely to weigh on high-risk stocks and contribute to further volatility.
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Emma Newbery has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Advanced Micro Devices and Amgen. The Motley Fool has a disclosure policy.
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