US. stocks closed lower on Tuesday as AI mania lost more steam and as more companies pulled their financial forecasts because of uncertainty created by President Trump's tariffs.
- The S&P 500 fell 43.47 points, or 0.8%, to 5,606.91. The drop came a day after the index broke a nine-day winning streak, its longest such run in more than 20 years.
- The Dow Jones Industrial Average fell 389.83 points, or 0.9%, to 40,829.
- The Nasdaq composite fell 154.58 points, or 0.9%, to 17,689.66.
Palantir Technologies fell 12.1% and was one of the heaviest weights on the market, even though the AI company reported a profit for the latest quarter that met analysts' expectations, the
AP reports.
AI-related companies have been finding it more difficult recently to convince investors to support their stocks after they've already shot so high. Palantir's stock's price remains near $110, when it was sitting at only $20 less than a year ago. The return to Earth for AI stocks is happening as Trump's tariffs change the economic landscape for other companies. Clorox CEO Linda Rendle said her company saw changes in shopping behavior during the first three months of the year that led to lower revenue. The company reported both weaker revenue and profit for the latest quarter than analysts expected. Clorox expects the slowdowns to continue in the current quarter, and its stock fell 2.4%.
Toymaker Mattel, meanwhile, said it's "pausing" its financial forecasts for 2025, in part because the "evolving US tariff landscape" is making it difficult to predict how much US shoppers will spend over the holiday season and the rest of this year. Mattel rose 2.8%. after reporting better results for the latest quarter than analysts expected. Ford Motor, which rose 2.7%, said it's expecting to take a $1.5 billion hit this year because of tariffs. Ford said it's also cancelling financial forecasts for the full year because of "tariff-related uncertainty."
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DoorDash fell 7.4% after reporting weaker revenue than analysts expected for the latest quarter, though it may have also offered an encouraging snapshot of how US households are doing. The company said order growth in its US marketplace remained healthy and consistent with average growth over the last year. The Federal Reserve is beginning a two-day meeting, and it will announce its next move on interest rates Wednesday. Virtually no one expects it to do anything to its main rate, even though Trump has been advocating for cuts.
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