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The S&P 500 fell on Thursday as Oracle’s results reignited fears about high-flying tech stocks even after the Federal Reserve’s latest interest rate cut gave a boost to U.S. equity markets in the prior session.
The Dow Jones Industrials leaped 287.47 points, to begin the trading day at 48,345.22, boosted by a rise in Visa shares after the name was upgraded at Bank of America.
The much-broader index backtracked 27.71 points to 6,858.97.
The NASDAQ lost 214.59 points to 23,499.96.
Oracle shares tumbled 14% after the cloud computing company posted disappointing quarterly revenue and raised its spending forecast, heightening concerns about the company’s debt.
The report added more fuel to the debate about how quickly tech companies will be able to see returns on their AI investments. Other AI plays were also trading lower in extended trading, including Nvidia and AMD, which were down 3% and 4%, respectively. CoreWeave fell 6%.
Those moves put a damper on the momentum garnered during the previous session, which saw the S&P 500 close just inches away from a new record after a divided Fed announced an interest rate cut for the third time this year and ruled out a rate hike.
The central bank’s Federal Open Market Committee cut its key overnight borrowing rate by a quarter percentage point to a 3.5%-3.75% range and signaled a slower pace of rate cuts ahead.
Prices for the 10-year Treasury were up Thursday, lowering yields to 4.11% from Wednesday’s 4.15%. Treasury prices and yields move in opposite directions.
Oil prices slumped $1.08 to $57.38.
Gold prices advanced $30.20 to $4,254.90.
