U.S. stocks slipped into negative territory Tuesday, as a sharp pullback in megacap tech on renewed AI spending concerns offset strength in energy shares fueled by a surge in crude prices.
Oil rallied despite limited geopolitical reaction after President Donald Trump said Iran is a "state of collapse" and suggested Tehran wants the Strait of Hormuz reopened "as soon as possible."
West Texas Intermediate crude jumped 3.6% to about $100 per barrel, while Brent rose 2.8% to $111.28, with ongoing disruption in the Hormuz route keeping supply risk premiums elevated. Prices held gains even after the United Arab Emirates signaled plans to exit the OPEC+ cartel, a move that could boost future supply.
Meanwhile, fresh doubts around artificial intelligence spending weighed on tech. Reports that OpenAI missed internal user-growth targets reignited concerns over whether aggressive capital expenditures in AI are justified, triggering broad selling across software and semiconductor names.
The S&P 500 fell 0.5% to 7,137, pulling back from record highs. The Nasdaq 100 dropped 0.9% to 27,052, led lower by AI-linked stocks. Within the Magnificent Seven, Nvidia Corp. (NASDAQ:NVDA) declined 1.2%, while Meta Platforms Inc. (NASDAQ:META), Microsoft Corp. (NASDAQ:MSFT), and Alphabet Inc. (NASDAQ:GOOGL) traded lower ahead of earnings due after the close Wednesday.
The Dow Jones Industrial Average outperformed, rising 99 points, or 0.2%, supported by gains in The Coca-Cola Company (NYSE:KO), JPMorgan Chase & Co. (NYSE:JPM), and UnitedHealth Group Inc. (NYSE:UNH).
Coca-Cola surged 6.5% after first-quarter earnings beat expectations. The company reported EPS of $0.86, topping the $0.81 consensus, on revenue of $12.47 billion versus estimates of $12.24 billion. The stock is on track for its strongest session since February 2009.
Tuesday’s Performance In Major US Indices
| Index | Last | % Change |
|---|---|---|
| S&P 500 | 7,124.59 | -0.7% |
| Dow Jones | 49,267 | +0.2% |
| Nasdaq 100 | 26,896 | -1.5% |
| Russell 2000 | 2,753.24 | -1.3% |
According to the Benzinga Pro platform:
- The Vanguard S&P 500 ETF (NYSE:VOO) fell 0.7%.
- The SPDR Dow Jones Industrial Average ETF Trust (NYSE:DIA) rose 0.2%.
- The Invesco QQQ Trust (NASDAQ:QQQ) dropped 1.5%.
- The iShares Russell 2000 ETF (NYSE:IWM) slid 1.3%.
Tech Buckles Under AI Capex Doubts As Defensives Lead
The Technology Select Sector SPDR Fund (NYSE:XLK) was the worst-performing S&P 500 sector, falling about 2% as investors trimmed exposure to AI infrastructure plays. The Energy Select Sector SPDR Fund (NYSE:XLE) led to the upside with a 1.7% gain on the back of the oil rally, while the Consumer Staples Select Sector SPDR Fund (NYSE:XLP) added 0.6% on a clear defensive rotation.
Among industry ETFs, the iShares PHLX SOXX Semiconductor Sector Index Fund (NYSE:SOXX) tumbled 3.4% – the fund’s worst session in a month – hit by the AI capex unwind.
On the earnings front, Centene Corporation (NYSE:CNC) surged 12.4% after first-quarter adjusted EPS of $3.37 beat the $2.13 consensus. Revenue came in at $49.94 billion, above estimates of $47.55 billion. The company raised full-year adjusted EPS guidance to greater than $3.40 and increased its 2026 premium and service revenue outlook by $1 billion.
Revolution Medicines, Inc. (NASDAQ:RVMD) climbed 10.4%, extending gains following its Phase 3 RASolute 302 data in metastatic pancreatic cancer released earlier this month.
On the downside, Spotify Technology S.A. (NYSE:SPOT) dropped 13.2% after reporting regional weakness in North America, despite global Premium subscribers reaching 293 million. The company posted EPS of $3.46, above the $3.03 estimate.
Smithfield Foods, Inc. (NASDAQ:SFD) fell 10.4% despite reporting record fiscal first-quarter 2026 results, with operating profit rising 3.4% year over year, as cautious consumer outlook commentary weighed on sentiment.
Qiagen N.V. (NYSE:QGEN) declined 10.3% after guiding fiscal 2026 EPS to $2.43 versus the $2.51 consensus, and revenue to $2.1 billion compared to the $2.2 billion estimate.
Alexandria Real Estate Equities, Inc. (NYSE:ARE) dropped 9.9% after first-quarter adjusted funds from operations of $1.73 matched expectations but fell sharply from $2.30 a year ago, with management citing potential tenant reductions.
Corning Incorporated (NYSE:GLW) slid 9.0% despite beating expectations with EPS of $0.70 and revenue of $4.35 billion, as investors locked in profits following a strong pre-earnings run.
Tuesday’s Russell 1000 Top Gainers
| Name | % Change |
|---|---|
| Centene Corporation (NYSE:CNC) | +12.37% |
| Revolution Medicines, Inc. (NASDAQ:RVMD) | +10.41% |
| GitLab Inc. (NASDAQ:GTLB) | +6.50% |
| The Coca-Cola Company (NYSE:KO) | +6.31% |
| ManpowerGroup Inc. (NYSE:MAN) | +5.25% |
Tuesday’s Russell 1000 Top Losers
| Name | % Change |
|---|---|
| Spotify Technology S.A. (NYSE:SPOT) | -13.20% |
| Smithfield Foods, Inc. (N/A) | -10.39% |
| Qiagen N.V. (NYSE:QGEN) | -10.27% |
| Alexandria Real Estate Equities, Inc. (NYSE:ARE) | -9.89% |
| Zimmer Biomet Holdings, Inc. (NYSE:ZBH) | -9.71% |
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