U.S. stocks extended their losses on Thursday as investors shifted to a risk-off mode, unwinding crowded positions in technology shares and cryptocurrencies.
The Dow Jones Industrial Average fell 592.58 points, or 1.20%, to close at 48,908.72. The S&P 500 declined 1.23% to 6,798.40, slipping into negative territory for the year, while the Nasdaq Composite dropped 1.59% to finish at 22,540.59. Losses were steeper intraday, with the Dow down nearly 700 points at its low and both the S&P 500 and Nasdaq falling as much as 1.5% and 1.9%, respectively.
Technology stocks remained under pressure after Alphabet, the latest of the “Magnificent Seven” to report earnings, warned of a sharp increase in artificial intelligence spending. The company projected 2026 capital expenditures of up to $185 billion, unsettling investors and sending shares down 0.5%. In contrast, Broadcom rose nearly 1% on optimism that the spending surge could benefit select AI suppliers.
Qualcomm also weighed on the sector, sliding more than 8% after issuing a weaker-than-expected outlook, citing a global memory shortage.
Meanwhile, selling intensified in cryptocurrencies, with bitcoin dropping below $64,000 after earlier breaking under the key $70,000 support level. Precious metals also came under heavy pressure, as silver prices snapped a two-day rebound and fell as much as 16%, extending losses after a nearly 30% plunge last Friday.
Adding to the cautious mood, fresh labor market data raised concerns about economic softness. Challenger, Gray & Christmas reported that U.S. employers announced 108,435 layoffs in January — the highest January figure since the global financial crisis. Initial jobless claims for the week ended Jan. 31 also rose more than expected, while job openings in December fell to their lowest level since September 2020.
Investors are now looking ahead to next week’s January jobs report from the Bureau of Labor Statistics, which was delayed due to the partial government shutdown that ended earlier this week.
