Stocks slid Wednesday as investors looked ahead to a key inflation report due later this week.
The S&P 500 pulled back 0.17% to close at 5,069.76. The Nasdaq Composite fell 0.55% to 15,947.74. The Dow Jones Industrial Average shed 23.39 points, or 0.06%, to end at 38,949.02 and notch a third straight day of losses.
UnitedHealth lost nearly 3% to lead the Dow lower. Intel and Alphabet declined 1.7% and 1.8%, respectively. Elsewhere, Urban Outfitters fell 12.8% after reporting weaker-than-expected results for the fourth quarter.
Investors are looking toward the personal consumption expenditure reading for January on Thursday, which is the Federal Reserve’s preferred measure of inflation.
“The market is clearly just treading water ahead of the PCE report,” said Jay Hatfield, CEO at Infrastructure Capital Advisors.
The report will come as the market tries to build on the gains that took the Dow and S&P 500 to record highs. This week, the market has struggled, however, pulling back modestly. The major indexes are pacing for their second negative week in three.
The recent slump, particularly for the tech sector, has raised questions about the staying power of a rally fueled by excitement over artificial intelligence.
“The AI hype is not sustainable because much of the stock gains seen due to AI are about the marketing of AI and the hype. Only one or two companies have actually experienced a specific revenue bump from AI,” said David Bahnsen, chief investment officer at The Bahnsen Group.
“Where there has been AI fever — and there has been a lot of it — it has priced in perfection and then some. It is a 1999 déjà vu,” he added.