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2w ago

US Stock Rally Ends as Tariff Uncertainty and AI Valuation Concerns Weigh on Markets

The S&P 500 fell 0.8% for a second consecutive session, with AI-driven momentum stocks underperforming and companies withdrawing profit forecasts due to tariff risks.

The German share price index DAX graph is pictured at the stock exchange in Frankfurt, Germany, October 18, 2024. REUTERS/Staff/File Photo
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Overview

  • The S&P 500 declined 0.8% on Tuesday, marking its second straight day of losses after a nine-day winning streak driven by AI optimism.
  • Palantir's stock dropped 12% following earnings that failed to meet high investor expectations, highlighting concerns over AI stock valuations.
  • Constellation Energy surged over 10%, benefiting from strong AI-driven data center demand and exceeding revenue forecasts.
  • DoorDash shares fell more than 7% after reporting mixed quarterly results and announcing acquisitions of Deliveroo and SevenRooms for $5.2 billion combined.
  • A growing number of companies, including Ford and Mattel, have paused profit forecasts, citing uncertainties linked to President Trump's evolving tariff policies.