U.S. sharemarkets fell for a second straight session as investors continued to unwind crowded trades in technology and digital assets. The Dow Jones Industrial Average dropped 1.2 per cent, or about 593 points, to finish at 48,908. The S&P 500 lost 1.23 per cent to 6,798, slipping into negative territory for the year, while the Nasdaq Composite fell 1.59 per cent to 22,541. Losses accelerated during the session, with technology stocks again leading the decline.
Big tech under pressure as AI spending debated
Earnings season added to volatility. Alphabet flagged a sharp rise in artificial intelligence investment, projecting capital expenditure of up to US$185bn in 2026. The scale of spending unsettled some investors, pushing the stock modestly lower. By contrast, Broadcom gained close to 1 per cent as markets weighed which suppliers could benefit most from sustained AI outlays. Qualcomm slid more than 8 per cent after issuing a weaker outlook tied to a global memory shortage.
Crypto and commodities sell-off intensifies
Risk aversion spilled into alternative assets. Bitcoin fell below US$64,000, extending a sharp retreat after breaking the US$70,000 level earlier in the week. Precious metals were also hit hard, with silver tumbling as much as 16 per cent in the session, following a near 30 per cent plunge late last week. The moves underscored forced selling across highly leveraged parts of the market.
Labour market data darkens the outlook
A run of U.S. labour indicators reinforced concerns that economic momentum is fading. January layoff announcements rose to their highest level for the month since the global financial crisis. Initial jobless claims climbed more than expected, while job openings fell to their lowest level since September 2020. Attention now turns to the delayed January jobs report from the Bureau of Labor Statistics, with markets increasingly pricing in a mid-year rate cut from the Federal Reserve.
Australian market outlook
Australian shares are poised to open weaker, tracking the extended losses in New York. ASX 200 futures are down 98 points, or 1.1 per cent, pointing to an opening level near 8,752. Locally, focus will be on testimony from Michele Bullock, while company results are due from News Corp, REA Group and Charter Hall Retail REIT. In the U.S., earnings from Amazon and Atlassian are due after the close, setting the tone for the next session.
