Stocks Pressured as Chipmakers Tumble

The S&P 500 Index ($SPX) (SPY) today is down -0.74%, the Dow Jones Industrial Average ($DOWI) (DIA) is up +0.13%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down -1.40%.  March E-mini S&P futures (ESH26) are down -0.74%, and March E-mini Nasdaq futures (NQH26) are down -1.42%.

Stock indexes are mostly lower today, with the Dow Jones Industrials posting a 1-week low.  The broader market is under pressure today as Nvidia’s earnings failed to alleviate concerns about an overheated AI economy, which is weighing on chipmakers and AI-infrastructure stocks.  Although Nvidia easily beat Q4 earnings estimates and forecast a Q1 outlook above expectations, the stock is down more than 4% amid uncertainty over China, and it will continue to exclude data center revenue from China in its forecasts due to concerns about Chinese government approval. 

On the positive side, Salesforce is up more than +3% to lead software stocks higher after it gave a strong outlook for long-term sales and announced a large share buyback, calming fears about AI disruption in the software industry.

Geopolitical risks remain a negative for stocks as nuclear talks between the US and Iran are underway in Geneva.  Crude oil prices whipsawed higher today after Iran said nuclear talks with the US progressed “very intensely and very seriously.”  Crude prices initially fell more than -2% to a 1-week low today after the foreign minister of Oman, who is mediating the nuclear discussions between the US and Iran, said “creative and positive ideas” were exchanged.

Tuesday evening, President Trump said Iranian officials are "again pursuing their sinister nuclear ambitions," boosting speculation that the US may be preparing a military strike on Iran in the coming days.  Last Friday, President Trump said that he’s considering a limited military strike on Iran to ramp up pressure on the country to strike a deal over its nuclear program and gave them a March 1-6 deadline for an agreement over the country’s nuclear activities, and has threatened military strikes if it fails to comply.

In Tuesday night's State of the Union address, President Trump doubled down on his commitment to tariffs.  President Trump’s new 10% global tariffs went into effect on Tuesday after the Supreme Court struck down his global “reciprocal” tariffs last Friday. Mr. Trump subsequently threatened to raise the global tariff rate to 15%, and an administration official said the White House is working on a formal order to implement that higher rate, but the timeline for its implementation has not been finalized.  Mr. Trump is applying the 10% baseline levy under Section 122 of the 1974 Trade Act, which allows the president to impose the charge for 150 days without congressional approval. 

Stocks found support on the smaller-than-expected increase in US weekly jobless claims, a sign of labor market strength.  US weekly initial unemployment claims rose by +4,000 to 212,000, showing a stronger labor market than expectations of 216,000.

The market’s focus this week will be on corporate earnings results and economic news.  On Friday, the Feb MNI Chicago PMI is expected to slip -1.8 to 52.2. 

Q4 earnings season is nearing its end, with more than 90% of the S&P 500 companies having reported earnings results.  Earnings have been a positive factor for stocks, with 74% of the 453 S&P 500 companies that have reported beating expectations.  According to Bloomberg Intelligence, S&P earnings growth is expected to climb by +8.4% in Q4, marking the tenth consecutive quarter of year-over-year growth.  Excluding the Magnificent Seven megacap technology stocks, Q4 earnings are expected to increase by +4.6%.

The markets are discounting a 3% chance for a -25 bp rate cut at the next policy meeting on March 17-18.

Overseas stock markets are mixed today.  The Euro Stoxx 50 fell from a new record high and is down -0.29%.  China’s Shanghai Composite closed down -0.01%.  Japan’s Nikkei Stock 225 climbed to a new all-time high and closed up +0.29%.

Interest Rates

March 10-year T-notes (ZNH6) today are up +6 ticks.  The 10-year T-note yield is down -2.9 bp to 4.023%.  Mar T-notes climbed to a 2.75-month high today, and the 10-year T-note yield fell to a 2.75-month low of 4.012%.  Today’s stock market slump has spurred safe-haven demand for T-notes.  However, gains in T-notes are limited after weekly US jobless claims rose less than expected, a hawkish factor for Fed policy. Also, supply pressures are undercutting T-notes as the Treasury will auction $44 billion of 7-year T-notes later today. 

European government bond yields are moving lower today.  The 10-year German bund yield dropped to a 2-75-month low of 2.683% and is down -1.1 bp to 2.696%.  The 10-year UK gilt yield tumbled to a 14.5-month low of 4.271% and is down -3.2 bp to 4.285%.

The Eurozone Feb economic confidence indicator unexpectedly fell -1.0 to 98.3, weaker than expectations of an increase to 99.8.

Eurozone Jan M3 money supply rose +3.3% y/y, stronger than expectations of +2.9% y/y and the largest increase in 6 months.

Swaps are discounting a 2% chance of a -25 bp rate cut by the ECB at its next policy meeting on March 19.

US Stock Movers

AI-infrastructure stocks and chipmakers are sliding today after Nvidia’s results failed to quell investor concerns about the disruptive risk of artificial intelligence.  Broadcom (AVGO) is down more than -6% to lead losers in the Nasdaq 100, and Applied Materials (AMAT), Lam Research (LRCX), Western Digital (WDC), and Seagate Technology Holdings (STX) are down more than -5%.  Also, Nvidia (NVDA) is down more than -4% to lead losers in the Dow Jones Industrials despite reporting Q4 data center revenue of $62.3 billion, stronger than the consensus of $60.36 billion, as the results failed to quell investor concerns surrounding demand durability.  In addition, ASML Holding NV (ASML) and Micron Technology are down more than -4%, and Intel (INTC) and Marvell Technology (MRVL) are down more than -3%.

Software stocks are climbing today, a supportive factor for the broader market.  Atlassian (TEAM) is up more than +10%, and Intuit (INTU), CrowdStrike (CRWD), and Datadog (DDOG) are up more than +5%. Also, ServiceNow (NOW) is up more than +4%, and Salesforce (CRM) is up more than +3% after reporting Q4 revenue of $11.20 billion, above the consensus of $11.17 billion, and forecasting Q1 revenue of $11.03 billion to $11.08 billion, stronger than the consensus of $10.99 billion.  In addition, Autodesk (ADSK) is up more than +3%, and Adobe Systems (ADBE) is up more than +1%.

PROCEPT BioRobotics (PRCT) is down more than -22% after forecasting full-year revenue of $300 million to $410 million, weaker than the consensus of $422.1 million. 

Chemed Corp (CHE) is down more than -16% after reporting Q4 adjusted EPS of $6.42, well below the consensus of $7.03. 

Donaldson (DCI) is down more than -13% after reporting Q2 adjusted EPS of 83 cents, below the consensus of 89 cents, and cutting its full-year adjusted EPS to $3.93-$4.01 from a previous forecast of $3.95-$4.11, weaker than the consensus of $4.05. 

Pure Storage (PSTG) is down more than -13% after the company gave an outlook that TD Cowen said points to decelerating growth. 

Universal Health Services (UHS) is down more than -9% to lead losers in the S&P 500 after reporting Q4 net revenue of $4.49 billion, weaker than the consensus of $4.51 billion.

Trade Desk (TTD) is down more than -3% after forecasting Q1 revenue of $678 million, below the consensus of $688.8 million.

Synopsys (SNPS) is down more than -3% after forecasting full-year free cash flow of $1.90 billion, below the consensus of $1.94 billion. 

Chime Financial (CHYM) is up more than +12% after reporting Q4 revenue of $596.4 million, stronger than the consensus of $578.3 million, and forecasting full-year revenue of $2.63 billion to $2.67 billion, better than the consensus of $2.60 billion.

Paramount Skydance (PSKY) is up more than +10% to lead gainers in the S&P 500 after reporting Q4 revenue of $8.15 billion, above the consensus of $8.12 billion. 

Celsius Holdings (CELH) is up more than +10% after reporting Q4 sales of $721.6 million, well above the consensus of $639 million. 

Fair Isaac Corp (FICO) is up more than +8% after announcing a new $1.5 billion stock buyback program.

J M Smucker (SJM) is up more than +6% after it said two new directors will be joining the board as part of an agreement reached with activist investor Elliot Investment Management. 

Janus Henderson Group Plc (JHG) is up more than +5% after Victory Capital offered to buy the company for $57.04 a share. 

Earnings Reports(2/26/2026)

AES Corp/The (AES), Autodesk Inc (ADSK), Block Inc (XYZ), Coterra Energy Inc (CTRA), Dell Technologies Inc (DELL), EMCOR Group Inc (EME), Hormel Foods Corp (HRL), Intuit Inc (INTU), J M Smucker Co/The (SJM), Monster Beverage Corp (MNST), NetApp Inc (NTAP), Public Service Enterprise Group (PEG), Qnity Electronics Inc (Q), SBA Communications Corp (SBAC), Sempra (SRE), Solventum Corp (SOLV), Viatris Inc (VTRS), Vistra Corp (VST), Warner Bros Discovery Inc (WBD), Zscaler Inc (ZS).