US stocks mostly fell on Wednesday as Wall Street assessed a fresh wave of earnings and waited for Alphabet (GOOG, GOOGL) results, eyeing the fallout from an AI-stoked slump in software and tech stocks.

The S&P 500 (^GSPC) slid about 0.5%, while the Nasdaq Composite (^IXIC) fell over 1.5%, continuing their bruising from Tuesday's session. The Dow Jones Industrial Average (^DJI) rose 0.4% as investors rotated away from tech stocks and into more blue-chip names.

Wall Street is failing to find its feet after AI disruption fears fueled a rush out of software stocks — spilling over into a deep global sell-off that hit Europe and Asia markets alike. Meanwhile, broader AI gloom has helped spur the rotation from high-profile tech names into value stocks, with megacaps taking the hit. Nvidia (NVDA) fell over 3%, while Google fell nearly 2% ahead of its earnings reveal. Amazon (AMZN) slid over 2%, and Tesla (TSLA) sank more than 3%.

Even better-than-expected earnings are no longer enough to convince the market, JPMorgan warned, unless the company reporting can show that AI will be a tailwind rather than a headwind. Advanced Micro Devices (AMD) shares plummeted as the chipmaker's weak sales outlook cast doubt on its ability to take on AI bellwether Nvidia.

In a sign of cracks in the labor market, an ADP report showed employers added just 22,000 jobs in January, versus the 45,000 expected. Private data has taken on outsized importance amid the delay in federal jobs data from the partial government shutdown that ended Tuesday, as the Bureau of Labor Statistics has rescheduled the official jobs report for next Wednesday.

Meanwhile, gold (GC=F) gained amid US-Iran tensions, but its comeback from a hefty record-shedding slump faltered as it fell back below $5,000 an ounce. Bitcoin (BTC-USD) losses also piled up, as the cryptocurrency traded near $72,000.

In corporates, pharma fortunes diverged as Eli Lilly's (LLY) stock jumped after it posted an upbeat 2026 profit forecast thanks to soaring demand for its weight-loss drugs. But shares in rival Novo Nordisk (NVO, NOVO-B.CO) tumbled after the maker of Ozempic and Wegovy shocked investors by forecasting a steep drop in sales.

Yahoo Finance's Ben Werschkul reports:

Vice President JD Vance announced a new push on Wednesday to create price stability in the market for critical rare earth minerals and said he wants to use a familiar Trump-world tool to accomplish it: tariffs.

During a speech at the State Department on Wednesday, Vance unveiled an effort to create a protected trade zone with as many nations as possible that are \\"protected from external disruptions through enforceable price floors.\\"

Read more here.

Yahoo Finance's Dan Howley reports:

The AI boom has turned Nvidia (NVDA) into the world's most valuable company, at one point pushing its market capitalization past the $5 trillion mark. It also boosted Google (GOOG, GOOGL) and Microsoft's (MSFT) earnings and turned ChatGPT into a household name.

But the AI frenzy isn't limited to companies that make AI chips or even the ones that build AI software. Memory and storage companies are also benefiting from the AI explosion.

AI data centers house thousands of computer servers that run the AI apps people use every day. And while GPUs from Nvidia and Advanced Micro Devices (AMD) generally do the heavy lifting, those servers also need memory and storage, just like your laptop or smartphone.

Read more here.

During his five years as a Fed governor, Kevin Warsh routinely raised concerns about inflation and protecting central bank credibility by ensuring inflation expectations remained anchored, even as he voted throughout most of his tenure to either hold interest rates steady or lower them.

Warsh, President Trump's nominee to be the next chair of the Federal Reserve, served on the Fed from 2006 to 2011. A review of his speeches during that time and transcripts of policy meetings paints a picture of an inflation hawk by philosophy but a data-driven practitioner.

\\"In all likelihood, he'll follow the pattern that the FOMC has shown for years, and that is let the data tell you what's the right policy,\\" former Atlanta Fed president Dennis Lockhart said in an interview. \\"He understands that.\\"

Read more here.

A tech-driven selloff continued to weigh on markets in midday trading on Wednesday as Wall Street failed to find sturdy footing.

The tech-heavy Nasdaq Composite (^IXIC) led the way down on Wednesday, shedding roughly 2%, while the S&P 500 (^GSPC) lost around 0.9%. The blue chip-heavy Dow Jones Industrial Average (^DJI) had initially rallied to start the session, but sat at a gain of roughly 0.1% as of 1 p.m. ET.

The software sector managed to slow the bleed midday after an initial drop, with losses of 1% and 2%, respectively, at industry leaders Salesforce (CRM) and ServiceNow (NOW). SAP SE (SAP), whose weak earnings had been a key trigger of the sell-off, flipped to a gain of 0.1%.

Also weighing on markets on Wednesday were weaker-than-expected January jobs numbers. Private payrolls data provider ADP reported that private companies added 22,000 jobs in January, far below economists' consensus estimates of 45,000 jobs and December's add of 41,000 payrolls.

The US economy's growth is likely to be front-loaded in 2026, Bank of America economist Aditya Bhave said in a client note Wednesday morning, even as consensus estimates see growth largely steady.

Consensus estimates predict that the US will grow at a steady pace this year, with estimates calling for growth each quarter between 2% and 2.2%. Instead, Bhave wrote, the economy's increase is likely to be tilted toward the front half of the year.

First quarter and second quarter growth are likely to land at 2.6% and 3%, respectively, while third quarter and fourth quarter growth are likely to both land at 2%, Bhave said.

\\"Consensus forecasts are not accounting for significant tailwinds to 1H 2026 GDP growth,\\" Bhave wrote. He highlighted the consumer stimulus coming from the One Big Beautiful Act and last year's government shutdown, which he said is likely to boost first quarter growth by 0.5% to 1%.

Bitcoin (BTC-USD) fell more than 4% on Wednesday to $73,000 per token after Treasury Secretary Scott Bessent suggested the US government would not bail out the cryptocurrency.

In a heated back-and-forth during a House Financial Services Committee hearing, Bessent was asked if the US Treasury had the authority to buy bitcoin or other cryptos.

\\"I do not have the authority to do that, and as chair of FSOC, I do not have that authority,\\" Bessent stated.

The decline on Wednesday only adds to bitcoin's recent rout. The world's largest cryptocurrency is down 13% over the past five days.

Disruptions to official labor market data appear minor after a four-day temporary partial government shutdown ended on Tuesday afternoon.

The Bureau of Labor Statistics just released its revised data schedule to account for delays caused by the temporary shutdown. Here are the new release times for several key reports:

December Job Openings and Labor Turnover Survey: Thursday, Feb. 5

January employment report: Wednesday, Feb. 11

Consumer Price Index: Friday, Feb. 13

The all-important jobs report was originally scheduled for this Friday, but investors will have to wait another three days for the official numbers. In the meantime, my colleague Emma Ockerman has a breakdown of what private jobs data told us about the state of employment in January.

Reuters has a good rundown of the state of play in the software sector:

The selloff was triggered by a new legal tool from Anthropic (ANTH.PVT), which showed the ​AI industry's growing push into industries that can unlock lucrative enterprise revenue needed to fund massive investments in the technology.

That push has sparked fears of disruption in industries ‌ranging from finance to law and coding.

Grappling with slower progress in the development of the AI models that power their technology, startups such as OpenAI and Anthropic are under pressure to justify their steep valuations.

Their strategy is reminiscent of ‌how Amazon (AMZN) disrupted several industries by first winning a niche online book market and then using that foothold to build a business that now spans retail, cloud and logistics.

Some analysts said the success of AI startups was, however, far from guaranteed, given that they lack the specialized data that is crucial to businesses in the industries.

\\"It feels like an illogical leap to extrapolate Claude Cowork Plugins, or any similar personal productivity tools, to an expectation that every company will hereby write and maintain a bespoke product to replace every layer of mission-critical enterprise software they have ever deployed,\\" said Mark Murphy, ⁠Head of U.S. Enterprise Software Research at J.P. Morgan.

The S&P 500 ‌software and services index slid nearly 13% over five straight sessions and is down 26% from its October peak, whereas the S&P 500 scaled an all-time high just this week.

Read more.

During the fourth quarter earnings call for power management giant Eaton Corporation (ETN), CEO Paulo Ruiz Sternadt said the company's backlog of orders \\"just keeps growing\\" and projected a continued firehose of demand as the AI arms race powers on.

Data center orders at Eaton roughly tripled in the fourth quarter over the prior year, while the backlog for its \\"Electrical Americas\\" division grew by 31% year-on-year to hit a new record, Sternadt said during the call on Tuesday.

Eaton's stock price spiked after the report and is up by more than 6% over the past five trading sessions and by more than 16% on the year.

Eaton reported fourth quarter revenue at $7.05 billion, outperforming revenue of $6.24 billion from a year ago but falling below analysts' expectations of $7.09 billion.

On the bottom line, the company reported adjusted earnings per share of $3.33 per share, outperforming estimates of $3.32 per share.

Talking about Eaton's strong order backlog, Sternadt attributed much of the company's success to the demand from AI hyperscalers.

\\"You probably noticed on recent news from the hyperscalers that they reconfirmed their capex plans for 2026 — this is also great news that supports these projects,\\" Sternadt said. \\"Multi-tenant and new cloud players, they are so active, never seen them so active as they are today. If I'm to summarize the market picture here, lots of strength, and these projects will take years to complete. So that's what gives us the optimism in the future.\\"

Eli Lilly (LLY) stock rose as much as 7% early Wednesday after the pharmaceutical giant rolled out a strong sales outlook, touting the strength of its weight loss portfolio and pressuring shares of Danish drugmaker Novo Nordisk (NVO) for a second-straight day.

On Tuesday, Novo Nordisk said it expects a 5% to 13% drop in sales on 2026 due to increasing competition and regulation. Since the start of February, Novo Nordisk has lost roughly $50 billion in market cap as investors have fled the stock.

With Wednesday's surge, Eli Lilly's market cap is now north of $950 billion as it looks to retake the $1 trillion market cap threshold it briefly cleared earlier this year.

Eli Lilly reported Wednesday morning that it expects 2026 revenue to grow sharply, with sales rising between 20%-25% at the midpoint of its estimates. The company is forecasting revenues of $80 billion-$83 billion compared to 2025 revenue of $65.2 billion.

\\"We reached millions more patients—launching Inluriyo, expanding Mounjaro and Kisunla globally, and submitting orforglipron for approvalm,\\" Eli Lilly CEO David Ricks said in the company's fourth-quarter earnings release. \\"We expanded our manufacturing capacity, and through our U.S. government agreement, opened new access to obesity medicines.\\"

The software sector has been shaken by a brutal sell-off over the last few days as a chorus of investor fears has grown over AI-driven disruption and displacement across the industry. Major names such as SAP SE (SAP), Salesforce (CRM), and ServiceNow (NOW) have each seen their stock prices fall more than 15% over the past five trading sessions.

Yahoo Finance's Brian Sozzi says the sell-off has more room to run. He writes:

Far be it from me to offer up a differing perspective than the almighty AI chip god, more formally known as Nvidia (NVDA) founder and CEO Jensen Huang.

But this one time, as it pertains to the AI stock rout we are witnessing, I must \\"push back\\" on the often-leather-jacket-clad Big J.

\\"There's this notion that the tool in the software industry is in decline, and will be replaced by AI ... It ​is the most illogical thing in the world, and time will ‌prove itself,\\" Huang reportedly said at an AI event that router giant Cisco (CSCO) held on Tuesday. \\"If you were a human or robot, artificial, general robotics, would you use tools or reinvent tools? The answer, obviously, is to use tools ... That's why the latest breakthroughs in AI are about tool use, because the tools are designed to be explicit.\\"

At this crucial moment for tech investors, the market couldn't care less what Jensen has to say on this topic. Sure, Jensen is often the one who stirs the drink in markets, in part because Nvidia is the one that stirs the drink in markets.

But the market fully believes software companies such as Salesforce (CRM), Workday (WDAY), Thomson Reuters (TRI), SAP (SAP), and ServiceNow (NOW) have their terminal values at risk because of quickly developing advancements in AI.

Just look at what Anthropic (ANTH.PVT) debuted on Friday, which initially flew a little under the radar before sparking another software rout on top of the rout we had already seen in 2026.

The AI developer debuted plug-ins for its Claude Cowork agent that could automate tasks across legal, sales, marketing, and data analysis.

By the close of trading on Tuesday, shares of Thomson Reuters, LegalZoom.com (LZ), PayPal (PYPL), Expedia Group (EXPE), Equifax (EFX), and Intuit (INTU) had all crashed by double-digit percentages. There is minimal nibbling at these names today on the deep pullback.

Read more here.

US stocks opened on wobbly ground to start Wednesday's trading session as the market looked to steady after a tech-led slide amid a fresh wave of earnings, while investors waited for Alphabet (GOOG, GOOGL) results to reveal the company's AI mojo.

The blue-chip Dow Jones Industrial Average (^DJI) rose on Wednesday morning, picking up roughly 0.5%. The S&P 500 (^GSPC) hovered just above the flat line after swinging between small gains and losses, while the tech-heavy Nasdaq Composite (^IXIC) ticked lower after tech stocks bore the brunt of the selling on Tuesday.

Wednesday's spotlight for Wall Street and Main Street alike will focus on earnings from Alphabet (GOOG) and Arm Holdings (ARM) results on Wednesday, with investors look for any signs of growing or shrinking AI demand. Those results will be followed by Amazon's (AMZN) quarterly release on Thursday.

Elsewhere in the market, gold (GC=F) continued to regain ground, rising above $5,000 an ounce on tensions between Washington and Tehran, while Bitcoin (BTC-USD) continued its plunge, crossing below $75,000.

In the labor market, employers added just 22,000 jobs in January, according to data released Wednesday morning from ADP, well below consensus estimates of 45,000. Friday's planned federal jobs report has been indefinitely delayed by the partial government shutdown that ended Tuesday.

US private employers added 22,000 jobs in January, according to data released by ADP, falling far below analyst estimates of 45,000 jobs added.

The reading on private payrolls, released Wednesday morning by ADP, fell short of all economist estimates compiled by Bloomberg, a potential sign of a still-cooling labor market. January's additions also fell short of December's additions of 41,000.

US economists at Deutsche Bank noted in a report Wednesday morning that January \\"tends to be the largest net job loss month as seasonal hiring ahead of the holidays unwinds.\\"

The healthcare sector was a standout for January job growth, ADP said, adding 74,000 jobs, while manufacturing continued its slowdown, shedding private payrolls every month since March 2024.

\\"Job creation took a step back in 2025, with private employers adding 398,000 jobs, down from 771,000 in 2024,\\" ADP chief economist Nela Richardson said in a statement. \\"While we've seen a continuous and dramatic slowdown in job creation for the past three years, wage growth has remained stable.\\"

Under normal circumstances, the market would have gotten a wider reading on the state of the labor market in the federal government's usual jobs report on Friday. However, the BLS has said that the report's release will be delayed due to the partial government shutdown, which ended on Tuesday.

That means that the week's private data releases — from ADP on Wednesday and from the job outplacement firm Challenger, Gray & Christmas with layoffs announcements on Thursday — will take on increased importance as investors search for a read on labor.

Read more here.

Yahoo Finance's Hamza Shaban writes in today's Morning Brief:

What's better than two private companies run by Elon Musk? One even larger company on the edge of going public.

That's the optimistic case for supercharging Musk's rocket firm SpaceX, with the acquisition of his AI startup xAI in a deal that values the private enterprise at $1.25 trillion.

Supercharge is not the verb that everyone would use, however. Skeptical internal shareholders and outside observers might see the mega merger as another instance of Musk's self-dealing. Using one profitable company with a compelling story to swallow an unprofitable one with ambiguous and expensive AI ambitions isn't so much a pitch as it is a corporate piggy bank.

But buying into the Musk trade can be a lucrative strategy. And clinging to his far-fetched plans has worked before.

Months ahead of a widely expected IPO, SpaceX has spruced itself up, becoming an even more diversified and dynamic investment vehicle for the Musk trade.

Read more here.

Silicon Laboratories' (SLAB) stock soared 52% before the bell on Wednesday after Texas Instruments (TXN) announced it would be buying the chip designer in a deal worth $7.5 billion.

The deal will allow Texas Instruments to expand its business into wireless connectivity chips.

Reuters reports:

Texas, whose core strength lies in analog chips that ⁠manage signals ‌and power in electronic equipments, will deepen its push ‍into internet-of-things markets by adding Silicon Labs' wireless technology.

As part of the deal, Texas ​will acquire Silicon Labs for $231 ‌per share, implying a premium of about 69% to Silicon Labs' last unaffected closing price on Tuesday, when the talks were first reported.

Read more here.

Eli Lilly (LLY) stock jumped 7% before the bell on Wednesday after the pharmaceutical group provided a 2026 profit forecast above Wall Street estimates. The company said it hopes demand for its weight-loss drugs rises as it prepares to release its oral weight-loss pill this year.

Reuters reports:

Lilly last ⁠year became the ‌first pharmaceutical company to hit a $1 trillion valuation, driven by the ‍popularity of its blockbuster weight-loss drug, Zepbound, and a rapidly expanding obesity market that is shifting ​toward cash-pay options and telehealth channels.

Lilly's ‌upbeat outlook stands in sharp contrast to that of rival Novo Nordisk (NVO), which has warned of \\"unprecedented\\" price pressures in 2026 after rattling investors with a forecast for a ⁠steep sales drop this ​year.

Read more here.

Bitcoin (BTC-USD) drifted lower before the bell, eyeing a break below $76,000 per token to continue its slump.

The digital currency has plunged about 40% since notching an all-time high in October, sparking a warning from Michael Burry. \\"The Big Short\\" trader said the plummet could cascade into a self-reinforcing \\"death spiral\\" that could hit companies with big bitcoin treasuries.

Bloomberg reports:

Almost half a trillion dollars has been wiped off cryptocurrencies in less than a week as a selloff led by bitcoin accelerated.

Total crypto market value has slumped by $467.6 billion since Jan. 29, according to CoinGecko data. Bitcoin on Tuesday tumbled to its lowest level since US President Donald Trump won re-election in early November 2024 and ushered in a more crypto-friendly administration.

Despite a pro-crypto White House and surging institutional adoption, Bitcoin has plummeted about 40% since rocketing to a record in early October. The rout follows a crippling series of liquidations on Oct. 10 that wiped out $19 billion in leveraged token bets, from which the broader crypto market has yet to recover.

“The mood is still risk-off, but the pace of forced selling has slowed compared with the US close,” said Rachael Lucas, an analyst at BTC Markets. Still, \\"biitcoin printing sub-$73,000 has pushed sentiment into extreme fear,” she said.

Read more here.

Microsoft's earnings stumble has intensified the focus on results from megacap names as AI worries pile pressure on tech stocks.

The next highlight is Alphabet (GOOGL, GOOG), set to report Q4 results after market close on Wednesday amid growing optimism from Wall Street for the Google parent's AI leadership.

Yahoo Finance's Laura Bratton reports:

Analysts tracked by Bloomberg expect revenue to climb more than 15% to $111.4 billion and earnings per share to rise to $2.65 from $2.15 in the year-ago period. The projected jump in revenue is expected to be spurred by a more than 35% rise in Google Cloud revenue to $16.2 billion.

Google Services — the segment including ad revenue from Search and YouTube, which accounts for the majority of Alphabet's revenue — is estimated to see revenue climb a more modest 13% from the previous year to $94.9 billion, per Bloomberg consensus estimates.

Alphabet stock could rise or fall as much as 5% following its fourth quarter report, according to Bloomberg data.

... Alphabet is positioned to boast \\"the highest quality top-line AI acceleration stories in the public universe,\\" Raymond James analyst Josh Beck wrote in a late-January note to clients, upgrading the stock's rating to a Strong Buy from Outperform. He pointed to Google's advantage as a full-stack AI provider, as the company has begun selling its AI chips, called TPUs, to external customers rather than reserving them solely for internal use.

Read more here.

Supermicro (SMCI) stock jumped 11% before the bell on Wednesday after the server maker raised its annual revenue forecast on Tuesday, citing continued strong demand for its AI servers driven by companies expanding their data center capacity.

Reuters reports:

Super Micro ‌has established itself as a primary beneficiary of the generative artificial intelligence boom, working closely with chip designers like Nvidia (NVDA) and Advanced Micro Devices (AMD) to quickly bring servers to market.

\\"Super Micro's growth is tied to its ⁠importance as the integrator ‌to large cloud and AI customers, said Gadjo Sevilla, technology analyst at Emarketer.

Sevilla added that by securing long-term ‍engagements and aligning inventory to their rollout timelines, the company ensures demand is met before production and minimizes volatility.

Its ability to quickly deliver fully integrated systems ​featuring Nvidia's latest GPUs has been critical to its success.

Read more here.

Enphase Energy (ENPH) stock soared 20% during premarket hours after the company's profit and revenue beat analysts' estimates. The technology company's shares have risen 10% over the past month, but are down almost 42% for the year.

The AP reports:

The Fremont, California-based company said it had net income of 29 cents per share. Earnings, adjusted for one-time gains and costs, came to 71 cents per share.

The results topped Wall Street expectations. The average estimate of nine analysts surveyed by Zacks Investment Research was for earnings of 54 cents per share.

The solar technology company posted revenue of $343.3 million in the period, also exceeding Street forecasts. Nine analysts surveyed by Zacks expected $334.6 million.

Read more here.