The S&P 500 and NASDAQ Composite fell on Tuesday, weighed down by a report that pointed to weakness in OpenAI as well as a rise in oil prices.
The Dow Jones Industrial Average eased 26.39 points to 49,141.40, lifted by a more than 5% gain in shares of Coca-Cola the company reported better-than-expected earnings.
The much broader index backpedaled 51.28 points to 7,122.63
The tech-driven NASDAQ plummeted 305.02 points, or 1.2%, to 24,582.08.
OpenAI recently saw revenue and new users growth that were below its own targets, according to a Wall Street Journal report. The report added that CFO Sarah Friar told leadership she was concerned OpenAI may not be able to pay computing contracts in the future if its top line doesn’t expand fast enough.
The report sent tech lower. Nvidia lost more than 2%, while Broadcom pulled back about 4%. Advanced Micro Devices and Intel were down 4% each. Oracle dropped 5%.
Tuesday’s moves come after the S&P 500 and Nasdaq hit record highs on Monday. The market’s gains were kept in check as peace talks between the U.S. and Iran appeared to come to a standstill.
The news comes during a major earnings week for the stock market, with five of the “Magnificent Seven” tech titans slated to report. Alphabet, Amazon, Meta Platforms and Microsoft are due Wednesday, while Apple’s results are set for Thursday.
Prices for the 10-year Treasury turned lower, pushing yields up to 4.37% from Monday’s 4.33%. Treasury prices and yields move in opposite directions.
Oil prices increased $3.50 to $99.87 U.S. a barrel.
Gold prices slid $105.20 to $4,585.50 U.S. an ounce.
