FX.co ★ US Stocks Erase Gains

On Thursday, U.S. stock indices reversed their modest gains, as investors continued to evaluate the Federal Reserve's rate outlook and the potential overvaluation of AI firms. The S&P 500 experienced a slight decline, the Nasdaq 100 dropped nearly 0.5%, while the Dow remained unchanged. Losses were largely driven by tech stocks, which mirrored a downturn in government bonds following a U.S. Treasury survey that revealed fund managers' concerns about a potential Fed Chair nominee implementing excessive rate cuts to satisfy President Trump. Within this landscape, Amazon's shares fell 2.3%, and Intel, Apple, and Alphabet saw declines of over 1% each. In contrast, Meta's stock surged 4% as its leadership contemplated budget reductions of up to 30% for its metaverse division in the upcoming year. Despite an unexpected drop in private payrolls as reported by ADP yesterday, which was counterbalanced by less definitive signs of a weakening labor market in today's unemployment claims and Challenger report, market participants still anticipated a Federal Reserve rate cut next week.