Nasdaq 100 and S&P500: Oracle Slides, Nvidia Struggles—Rebalancing Coming?

S&P 500 Steadies as Traders Eye AI Concerns and Inflation Data

The S&P 500 edged up 1.99 points, or 0.03%, to 6,658.91 on Wednesday morning at 14:22 GMT, showing little direction as traders weighed pressure on major AI stocks and awaited key inflation data. The Nasdaq Composite inched up 13.59 points, or 0.06%, to 22,587.06, while the Dow Jones Industrial Average gained 52.97 points, or 0.11%, to 46,345.75.

Are Nvidia and Oracle Signaling a Pause in the AI Trade?

AI leaders continued to drag on sentiment. Nvidia tried to recover from its sharp losses Tuesday—its worst single-day drop since late August—but gains were limited. Concerns persist after the chipmaker announced a deeper partnership with OpenAI, sparking fears that AI optimism may already be reflected in current stock valuations.

Oracle slipped further following its announcement of a corporate bond sale aimed at raising roughly $15 billion. The debt offering raised questions about the firm’s funding priorities and the durability of AI-driven growth. Micron fell nearly 2% after its earnings failed to inspire confidence, even with upbeat guidance. Microsoft also dipped 1% after disclosing cooling limitations that may constrain AI infrastructure expansion.

Can the Broader Market Push Higher with Fed and Inflation in Focus?

Despite the softness in big tech, the broader market found modest support. Traders are holding positions steady ahead of Thursday’s jobless claims and Friday’s PCE inflation release—the Federal Reserve’s preferred measure. On Tuesday, Chair Jerome Powell cautioned that market valuations were “notably high,” reinforcing market wariness.

What Names and Sectors Are Driving Action?

Energy stocks led gains, up 1.45%, helped by a near 80% surge in Lithium Americas after reports the Trump administration is seeking a 10% equity stake in the company. Consumer discretionary and financials also posted small gains, while real estate and materials pulled back.

Alibaba surged over 9% after unveiling expanded AI initiatives, while Coinbase added 1.2% following its AI-based payment infrastructure launch. Oracle’s continued slide and Micron’s underwhelming post-earnings performance pointed to broader hesitancy in chasing AI names at current levels.

What’s the Near-Term Outlook for Traders?

With equity indexes hovering near record highs, traders are watching Friday’s PCE inflation report for clues on Fed policy. A hotter-than-expected reading could revive rate-hike fears and stall momentum. Meanwhile, political risks are back in focus as lawmakers face a tight window to avoid a government shutdown.

Until clearer macro signals emerge, the path forward may hinge on whether AI-linked equities can regain momentum—or whether leadership shifts toward other sectors with stronger earnings and capital discipline.

More Information in our Economic Calendar.