Nasdaq, S&P 500 fall as AI caution weighs on tech, Nvidia results in focus
Feb 24 (Reuters) – The Nasdaq Composite fell more than 1% on Monday, with big technology stocks creating the biggest drag as investors worried about demand for technology supporting artificial intelligence while they waited for results from market heavyweight Nvidia.
The S&P 500 closed slightly lower, marking its third straight day of declines, while the Dow managed to eke out a tiny gain. It was also Nasdaq’s third consecutive loss and its fourth daily drop of more than 1% so far in February.
Investors were concerned about future demand for Nvidia’s (NVDA.O),pricey AI chips as they awaited its quarterly results on Wednesday. Worries about hefty spending on the technology have mounted since low-cost AI models from China’s DeepSeek rattled the industry in January.
Adding to uncertainty, a TD Cowen analyst note published late on Friday reported that Microsoft Corp (MSFT.O),has scrapped leases for sizeable data center capacity in the U.S., suggesting a potential oversupply of AI infrastructure.
Microsoft said its plan to invest over $80 billion in AI and cloud capacity this fiscal year was intact but that it “may strategically pace or adjust” infrastructure in some areas.
Gene Goldman, chief investment officer at Cetera Investment Management, noting that any question about AI is seen as a reason to take profits since the technology has driven market growth for the last few years, said:
Markets are already jittery and looking for a reason to take profits,
Along with worries about tariffs and inflation, investors are getting more anxious about economic growth after last week’s batch of weak economic data and a disappointing forecast from Walmart (WMT.N)
Goldman, said:
Volatility is being driven by market uncertainty about whether we’re facing a growth scare or an inflation scare,
The Dow Jones Industrial Average (.DJI), rose 33.19 points, or 0.08%, to 43,461.21, the S&P 500 (.SPX), lost 29.88 points, or 0.50%, to 5,983.25 and the Nasdaq (.IXIC), lost 237.08 points, or 1.21%, to 19,286.93.
The more defensive healthcare index (.SPXHC), led percentage gains, closing up 0.75% while technology (.SPLRCT), was the biggest laggard, ending down 1.43%.
Nvidia was the S&P 500’s biggest index point drag, ending the session down 3.1%, and it was followed by chip maker Broadcom Inc (AVGO.O), down 4.9%, Amazon.com (AMZN.O), down 1.8%. Microsoft shares ended down 1%.
READ the latest news shaping the AI Chips market at AI Chips News
Nasdaq, S&P 500 fall as AI caution weighs on tech, Nvidia results in focus, source
Add comment