Lead: Global equity markets showed a mixed picture on Thursday as U.S. futures climbed after a Wall Street rally driven by gains in Nvidia and other large-cap technology names. In New York, the S&P 500 slipped 0.4% while the Dow fell 257 points (0.5%) and the Nasdaq lost 0.6% in morning trade; broader market direction was influenced by corporate earnings, rising oil, and geopolitical worries about a potential U.S.–Iran confrontation. Several major retailers and travel-related companies reported results that beat expectations yet left investors cautious about future margins and competition. Treasury yields were steady, and traders watched whether stronger oil prices will complicate the Federal Reserve’s path on interest-rate cuts.
Key Takeaways
- The S&P 500 was down 0.4%, the Dow Jones fell 257 points (about 0.5%), and the Nasdaq declined roughly 0.6% in early trading.
- Booking Holdings shares plunged about 8% despite a quarterly profit that marginally beat analyst estimates, amid investor concern over AI-driven competition.
- Carvana fell 4.3% even after reporting a stronger-than-expected quarterly profit, with profit per vehicle weaker than investors hoped.
- Walmart rose 1.6% after beating results for the end of its fiscal year but issued forward profit guidance below Street estimates.
- eBay gained 2.8% after reporting stronger profit and revenue and announcing a roughly $1.2 billion cash acquisition of Depop to target younger buyers.
- U.S. crude prices climbed more than 1.5%, pushing benchmark West Texas Intermediate above $66 a barrel and lifting oil producers; Occidental jumped 8.7% on a stronger quarter.
- The 10-year Treasury yield held at about 4.09%, remaining near Wednesday’s close as unemployment-claims data suggested a slowing pace of layoffs.
Background
Equity markets have been grappling with two broad themes: the uneven flow of corporate earnings and the risk that geopolitical events could push energy prices higher and sustain inflation. Large-cap technology names, led by Nvidia, have been central to recent market rallies, but gains have coexisted with sharp selloffs in companies perceived to face disruptive competition from AI or other structural changes.
Investors are particularly sensitive to signals about the near-term economic outlook. A still-solid labor market — exemplified in recent unemployment-claims data — reduces the likelihood of quick rate cuts from the Federal Reserve, while rising oil costs can reintroduce inflationary pressure. Markets outside the U.S. reacted unevenly: Asian benchmarks ended mixed as some exchanges reopened after holidays, and European indexes fell later in the day.
Main Event
Trading on Thursday reflected a tug of war among earnings, geopolitics and macro data. In early New York trading the S&P 500 edged lower by 0.4%, the Dow traded about 257 points lower and the Nasdaq slid 0.6%. Stocks of companies with exposure to rising input costs or competitive threats underperformed even when headline profits beat expectations.
Booking Holdings dropped roughly 8% after investors zeroed in on future competitive risks from AI-powered rivals despite the company posting a profit that slightly exceeded analyst forecasts. Market watchers said the move illustrated a broader willingness by investors to penalize names they deem vulnerable, sometimes sharply and quickly.
Retailers showed mixed outcomes: Walmart rose around 1.6% after delivering stronger year-end results but issued a profit outlook for the coming fiscal year below analyst estimates, prompting a cautious reaction. eBay rose 2.8% after reporting revenue and profit above expectations and announcing a $1.2 billion cash deal to acquire Depop, a secondhand fashion marketplace aimed at younger shoppers.
Energy stocks outperformed as crude oil climbed more than 1.5%, lifting U.S. benchmark prices above $66 a barrel amid renewed fears of a military clash involving the United States and Iran. Occidental Petroleum jumped 8.7% after reporting better-than-expected quarterly results, reflecting the sensitivity of energy-sector earnings to oil-price moves.
Analysis & Implications
The market’s reaction underscores how earnings themselves no longer tell the whole story: investors are increasingly pricing in medium- to long-term structural risks, from AI disruption to geopolitical shocks. That has led to abrupt selloffs in companies seen as exposed, even after quarterly reports that meet or beat estimates. Such behavior raises questions about market efficiency and the role of short-term positioning in amplifying volatility.
Energy-price strength has two key implications: it supports oil and gas sector profits in the near term but risks reaccelerating inflation if sustained. Higher fuel costs feed into transportation and goods prices, which could slow the Federal Reserve’s willingness to cut rates. With the 10-year Treasury yield near 4.09%, fixed-income markets are pricing a cautious outlook on inflation and growth.
For policy and investors alike, the intersection of geopolitics and technology will be decisive. A conflict that threatens Middle East oil supplies would have a clear, near-term impact on energy markets and inflation expectations. Meanwhile, faster-than-expected AI adoption in specific industries could compress earnings for incumbent players, reshaping sector leadership and valuation multiples over months to years.
Comparison & Data
| Market / Indicator | Move |
|---|---|
| S&P 500 | -0.4% |
| Dow Jones Industrial Average | -257 points (~-0.5%) |
| Nasdaq Composite | -0.6% |
| U.S. crude (WTI) | +>1.5%, >$66/barrel |
| 10-year Treasury yield | 4.09% |
The table above summarizes the intraday moves reported in New York. Relative strength in energy names contrasts with weakness among companies seen as vulnerable to AI competition or margin pressure. Internationally, South Korea’s Kospi jumped 3.1% after markets reopened following Lunar New Year holidays, while Chinese exchanges remained closed.
Reactions & Quotes
“We want to see inflation fall further before we would support cutting rates.”
Federal Reserve (official commentary)
This paraphrased Fed message helps explain why Treasury yields remain elevated: officials signaled they need more evidence that inflation is on a downtrend before endorsing rate cuts.
“A ‘shoot first, ask questions later’ mentality has gripped investors, who are quick to penalize firms they view as at risk from AI or other disruptions.”
Market analysts (various)
Analysts used this phrase to describe heightened sensitivity across sectors, from software to logistics, where perceived vulnerability can trigger rapid investor exits despite recent earnings beats.
Unconfirmed
- Whether escalating rhetoric between the United States and Iran will lead to open military conflict remains unconfirmed and speculative at this time.
- The precise degree to which AI competitors will displace revenues at Booking Holdings and similar firms is uncertain and depends on adoption timelines and regulatory responses.
- Market commentary attributing particular stock moves solely to algorithmic trading or a single headline is difficult to verify without broker-level transaction data.
Bottom Line
Markets are navigating a volatile mix of earnings season details, geopolitical risk, and macro signals. Even when companies report profits that meet or beat expectations, investors are increasingly focused on forward guidance and structural threats — particularly from AI — which can prompt swift reevaluations of valuations.
Rising oil prices and a still-resilient labor market leave the Federal Reserve with less room to move quickly on cuts, so investors should expect policy considerations to remain central to market direction. In the near term, traders will watch any escalation in U.S.–Iran tensions, upcoming corporate guidance, and further inflation data for clues on whether the recent market patterns persist.