FX.co ★ US Stocks Fall for 2nd Day as AI and Fed Worries Mount

U.S. equities fell for the second consecutive day on Wednesday as investors navigated pressures on AI industry leaders, mixed messages from the Federal Reserve, and profit-taking at near-record market levels. The S&P 500 declined by 0.3%, while the Nasdaq 100 and Dow Jones each decreased by 0.4%, continuing the downturn that started on Tuesday and disrupted a previous three-day rally. Nvidia experienced a nearly 1% drop following its announcement of a $100 billion collaboration with OpenAI. Meanwhile, Oracle saw a 1.7% decrease and Micron Technology fell by 2.9% despite reporting better-than-anticipated earnings. Conversely, Alibaba's commitment to exceed its initial $50 billion AI spending pledge boosted its U.S.-listed shares by 8.2%. Nonetheless, investor sentiment remained under pressure due to concerns over high valuations, as Federal Reserve Chair Jerome Powell reaffirmed that inflation and labor market risks persist, cautioning that stock prices are still elevated. On the economic front, new home sales unexpectedly surged in August, providing a positive note amidst worries of slowing growth and seasonal market downturns.