NEW YORK, United States — Wall Street stocks experienced a sharp decline on Thursday as investors pulled back from major technology shares, nervously anticipating the latest U.S. inflation data.
The Nasdaq Composite led the slump, falling more than two percent as market sentiment soured toward the end of the session. The downturn was fueled by a mix of profit-taking, anxiety over future interest rate cuts, and emerging skepticism regarding the immediate disruptive power of artificial intelligence (AI).
Key Market Movers
- Tech Giants Under Pressure: Large-cap tech companies, including Apple, Amazon, and Meta, each lost more than two percent.
- AI Skepticism: Analysts noted that while AI has driven market rallies for months, investors are now questioning the scale of massive investments and their potential to disrupt established business models. “We continue to have selling in tech,” said Art Hogan of B. Riley Wealth Management. “There are concerns over what AI might disrupt.”
- Mixed Economic Signals: Markets are grappling with contradictory data; strong employment reports are currently being offset by weak retail sales and sluggish existing-home sales.
Anticipation for January CPI The primary focus for traders remains Friday’s release of the Consumer Price Index (CPI) for January 2026.
- Rate Cut Clues: Investors are looking for a cooling of inflation to justify potential interest rate cuts by the Federal Reserve.
- “Unable to Maintain Momentum”: Chris Beauchamp of IG noted that U.S. markets are currently “caught between payrolls and CPI,” making it difficult for indices to sustain upward movement without a clear signal from the upcoming inflation report.
Global Performance
- Europe: In contrast to the U.S., European markets showed resilience. The Paris CAC 40 struck a fresh record high, boosted by strong earnings from EssilorLuxottica (+3.8%) and Hermes (+2.8%). Germany’s Siemens also surged 5.8 percent after raising its annual outlook due to high AI-related spending.
- London: The FTSE 100 reached a new record intraday before closing lower on news of tepid growth in the final quarter of 2025.
- Asia: Markets across Asia remained subdued following the lackluster close in New York, with tech firms seeing further selling pressure.
Corporate Shakes in France French pharmaceutical giant Sanofi saw its shares sink 4.2 percent following the surprise ouster of CEO Paul Hudson. He will be replaced by Belen Garijo from Germany’s Merck KGaA, sparking concerns over the company’s future drug pipeline and strategic direction.
As the week draws to a close, all eyes remain fixed on the U.S. Labor Department’s inflation report, which is expected to dictate whether the current tech pullback is a temporary correction or the start of a broader trend of risk-aversion in 2026.