US STOCKS-Wall St slides as tech rally stalls, AI enthusiasm wanes after Nvidia results

C3.ai

26/02/2026 19:25

Updates to mid-afternoon trading

Indexes down: Dow 0.05%, S&P 500 0.73%, Nasdaq 1.45%

Philadelphia SE Semiconductor index set to snap 10-week winning streak

Trade Desk plunges after Q1 revenue forecast below estimates

J.M. Smucker jumps on Q3 beat, deal with Elliott

By Stephen Culp and Ragini Mathur

NEW YORK, Feb 26 (Reuters) - U.S. stock indexes turned sharply lower on Thursday, the day after a less-than-stellar earnings report from artificial intelligence vanguard Nvidia NVDA.O dragged technology shares which have provided muscle to the recent rally.

A pivot back to cyclical sectors helped limit the Dow's losses, while a 3.6% drop in the Philadelphia SE Semiconductor index .SOX helped drag the tech-laden Nasdaq down 1.5%.

     With Thursday's drop, the SOX, which has surged 15.3% year-to-date, is on the verge of snapping what would have been a record 11-week winning streak.

Technology shares .SPLRCT in general, and software .SPLRCIS and chips in particular, have see-sawed in recent weeks as investors wrestle with uneasiness over the massive costs and potential disruption of nascent AI technology.

While all three major U.S. stock indexes are on track for modest weekly losses, the S&P 500 and the Nasdaq are poised to close lower on the month. The Dow remains on track to post an advance in February.

Nvidia's fourth-quarter results, posted after Wednesday's closing bell, were better than analysts expected, and the chipmaker provided above-market estimates. But the world's richest company by market cap wrestled with increasingly difficult year-on-year comparisons as its revenue growth decelerates. Its shares were down 4.9%.

"Nvidia's results, while they were good and showed substantial growth year-over-year, they did not hit the high end of some people's expectations," said Joseph Sroka, chief investment officer at NovaPoint in Atlanta. "Now the news is over and there's probably a little bit of profit taking and we're seeing money now rotate back to the victims from earlier in the week, the software companies that were portrayed to be the ultimate victims of AI."

The Dow Jones Industrial Average .DJI fell 26.44 points, or 0.05%, to 49,449.13, the S&P 500 .SPX lost 51.00 points, or 0.73%, to 6,895.13 and the Nasdaq Composite .IXIC lost 335.80 points, or 1.45%, to 22,816.28.

Among the 11 major sectors of the S&P 500, tech .SPLRCT and communication services .SPLRCL suffered the steepest percentage losses, while financials .SPSY led the gainers, rising 1.0% on the strength of big bank shares, including JPMorgan Chase JPM.N, Bank of America BAC.N and Wells Fargo WFC.N.

The S&P 500 software and services index .SPLRCIS, battered in recent weeks on worries over AI-related disruption, gained 0.9%, boosted by a 3.1% increase in Salesforce CRM.N shares, even though the company provided weaker-than-expected revenue guidance.

Trade Desk TTD.O slid 3.9% following its disappointing revenue forecast amid mounting pressure from larger rivals.

J.M. Smucker SJM.N surged 9.1% on the packaged food company's solid quarterly profit and sales estimates.

C3.ai AI.N tumbled 19.3% after it provided a weaker-than-expected current quarter sales forecast and announced it would slash 26% of its global workforce.

Celsius Holding CELH.O jumped 7.1% after the energy drink maker beat quarterly revenue estimates.

Advancing issues outnumbered decliners by a 1.04-to-1 ratio on the NYSE. There were 310 new highs and 63 new lows on the NYSE.

On the Nasdaq, 2,069 stocks rose and 2,574 fell as declining issues outnumbered advancers by a 1.24-to-1 ratio.

The S&P 500 posted 35 new 52-week highs and one new low while the Nasdaq Composite recorded 74 new highs and 80 new lows.

Nvidia's revenue growth has slowed down https://www.reuters.com/graphics/NVIDIA-RESULTS/zdpxgymokvx/chart.png

(Reporting by Stephen Culp; Additional reporting by Shashwat Chauhan and Ragini Mathur in Bengaluru; Editing by David Gregorio)

((stephen.culp@thomsonreuters.com;))