US sharemarkets fell for a second straight session on Wednesday, extending a pullback from recent record levels as investors assessed a fresh round of earnings and weighed mounting political and geopolitical risks.
The S&P 500 dropped 0.53% to close at 6,926.60. The Dow Jones Industrial Average slipped 42 points, or 0.09%, to 49,149.63, while the Nasdaq Composite led the declines, falling 1% to 23,471.75. It marked the second consecutive day of losses for all three major indices.
Technology stocks drag the market lower
Technology stocks were the main source of weakness, with chipmakers under particular pressure. Broadcom fell around 4%, while Nvidia and Micron Technology each lost more than 1%.
Sentiment in the sector was dented by reports that Chinese customs authorities have advised agents that Nvidia’s H200 chips are not permitted to enter the country, highlighting renewed concerns around trade, technology restrictions, and access to overseas markets.
Banks slide despite earnings beats
Financial stocks also weighed on the market. Wells Fargo fell more than 4% after reporting weaker-than-expected fourth-quarter revenue. Bank of America and Citigroup both posted results that exceeded consensus estimates, but their shares still moved lower as investors judged the numbers insufficient to justify further gains with markets already near record highs.
Those declines have added to losses earlier in the week following President Donald Trump’s renewed push for credit card interest rate reform. Citigroup is down more than 7% week to date, Bank of America has fallen roughly 6%, and Wells Fargo is lower by almost 7%.
Inflation and Fed independence concerns
Markets were little supported by solid producer price index and retail sales data for November. Instead, investors focused on the inflation implications and what they could mean for future monetary policy.
Concerns about Federal Reserve independence have also intensified amid ongoing political attacks on Fed Chair Jerome Powell and a Justice Department investigation into the central bank’s leadership. The uncertainty has raised questions about how markets would react if inflation were to reaccelerate while the Fed’s policy stance came under pressure.
Geopolitical tensions add to uncertainty
Geopolitical risk remained another overhang. Oil prices were volatile, initially rising on fears of supply disruptions linked to unrest in Iran and tensions with the United States, before reversing sharply lower after signals that military action may not be imminent.
Attention also turned to talks between the US administration and Greenlandic and Danish officials, as the White House continues to push for US control of Greenland, framing it as a national security priority.
Local outlook
Australian shares are set to edge higher at the open, with ASX 200 futures up 24 points, or 0.27%, at 8,816. The local calendar is light, with no major economic data due on Thursday.
Looking ahead, investors will be watching offshore data releases and a busy US earnings schedule, with major financial institutions reporting in the next session.
