Stock market today: Dow, S&P 500, Nasdaq drop as chip stocks sink on OpenAI report, oil rises

Stocks slipped on Tuesday as tech took a hit, with semiconductors leading to the downside.

The Nasdaq Composite (^IXIC) dropped about 0.9%. The S&P 500 (^GSPC) pulled back 0.5%. Meanwhile, the Dow Jones Industrial Average (^DJI) dropped just below the flat line.

The slide came after a Wall Street Journal report said OpenAI had recently missed some of its metrics, renewing concerns of overspending in the artificial intelligence sector.

Shares of companies that partner with OpenAI declined during the session.

The report comes ahead of a busy week on Wall Street, with Big Tech set to report earnings.

Disney shares lower on Tuesday after the FCC ordered the eigh tof the media giant’s television stations to renew their licenses early.

The order, in a two-page letter from FCC Chairman Brendan Carr, comes after First Lady Melania Trump recently criticized late night host Jimmy Kimmel for comments he made about her on his show.

The early review of the stations’ licenses is linked to the FCC’s probe last year into Disney’s diversity, equity, and inclusion (DEI) practices and whether or not they were discriminatory.

The station must file to renew their licenses by May 28. Disney stock dropped nearly 1% on Tuesday.

Yahoo Finance’s Brooke DiPalma reports::

Coca-Cola (KO) stock jumped 6% on Tuesday after the company beat Wall Street’s earnings expectations as consumers gravitated toward low-calorie drinks and mini cans.

The beverage giant seemed to have cracked the code on consumers becoming more health- and cost-conscious. Global unit case volume was up 3%, more than the 1% Wall Street expected, per Bloomberg consensus data. In North America, volume grew 4%.

Read more here.

Yahoo Finance’s Pras Subramanian reports:

With Formula One’s (FWONK) Miami Grand Prix just days away, tiny Haas F1 is somehow in the driver’s seat.

Haas enters Miami in a surprising position — sitting fourth in the constructors’ standings through the first three races of the season, a remarkable result for the smallest team on the grid. But Ayao Komatsu, Haas F1’s team principal and trackside boss, is careful not to get ahead of himself.

“We’ve only done three races. It’s very early days,” he said in an interview with Yahoo Finance.

Read more here.

Oracle (ORCL) and CoreWeave (CRWV) came out in support of OpenAI on Tuesday after the Wall Street Journal reported that the AI developer recently missed sales and user targets, renewing concerns about overspending in the sector.

Shares of companies partnering with OpenAI sank after the report signaled that OpenAI’s business was slowing. Software giant Oracle and data center provider CoreWeave led the losses, down almost 4% and 5%, respectively.

Oracle defended the AI developer on X, writing, “We’re incredibly excited about our partnership with OpenAI and remain focused on building and delivering the capacity they need to support rapidly growing demand.”

CoreWeave struck a similar tone in a statement to Yahoo Finance, noting it also had other partners.

Read more here.

JPMorgan Chase CEO Jamie Dimon said Tuesday that if and when a pullback in the credit market emerges, it “will be worse than people think,” Bloomberg reported.

Speaking at a conference hosted by Norges Investment Bank, Dimon said that, given there are more than 1,000 private credit firms, some “may be brilliant, but I guarantee you not all 1,000 of them are.”

The comments from Dimon mark the latest in a string of remarks from the head of the world’s largest bank criticizing the private credit industry, which he has called a “roach” in the financial services sector.

Tempering his comments on Tuesday, Dimon said that a pullback in the sector “won’t be terrible, it’ll just be worse than people think in private credit.” He reiterated his view, laid out in his annual letter published earlier this month, that private credit “probably does not” pose a systemic risk to the financial markets.

JPMorgan is currently talking with a host of institutional investors about the bank investing billions of dollars in a private credit strategy.

Gold (GC=F) futures tumbled more than 2% on Tuesday, while silver (SI=F) fell 3% as the US and Iran appear to be at an impasse in negotiations amid ongoing tensions in the Middle East.

Precious metals were under pressure as investors priced in the possibility of elevated interest rates remaining in place for longer, with policymakers seeking to curb inflation fueled by rising oil prices.

Read more here.

The US 30-year yield (^TYX) is back near the danger zone that has sent stocks tumbling before.

That level is roughly 5.0%. It has acted like a ceiling for the long bond several times over the past three years, with each approach tightening financial conditions and pressuring stocks before yields backed off — a dynamic I flagged in March.

But the pattern is getting harder to ignore. The 30-year has been making higher lows beneath that ceiling, turning the chart into a long squeeze between rising support and the same old 5% wall.

I keep going back to a comment by RSM chief economist Joe Brusuelas, who framed the political risk early. In December 2024, before Trump took office, he said, “The stock market [was] the barometer of the first Trump administration. So, the bond market’s likely to be [that of] the second.”

The market does not need a bond market tantrum for this to bite.

If the 30-year holds above 5%, the pressure shifts quickly to housing, small caps, and expensive growth stocks — and Washington will have a harder time looking away.

OpenAI (OPAI.PVT) didn’t start the chip sell-off — it gave traders a reason to press it further.

Semiconductor stocks are lower for a second straight session after a Wall Street Journal report raised questions about OpenAI’s ability to support massive future data center spending commitments.

But the move is coming after a blistering, record-setting run: The PHLX Semiconductor Index (^SOX) had just posted an 18-day win streak, with 13 straight record highs by the end of the run.

Chris Versace, chief investment officer at Tematica Research, said the story is likely to weigh on companies tied to “chips to networking equipment and other aspects of digital infrastructure.” He added that the story raises questions about artificial intelligence adoption, usage, and whether the recent ramp in hyperscaler capex expectations had gone too far.

Oracle (ORCL) briefly looked like the software-adjacent casualty of the AI infrastructure trade, but its early losses have faded a bit.

The timing gives hyperscaler earnings extra weight. Microsoft (MSFT), Alphabet (GOOGL), Meta (META), and Amazon (AMZN) all report Wednesday after the bell.

Those reports are the real test of whether the AI capex story still has support from the hyperscalers, or whether traders keep pressing the weakest links in the build-out trade.

The US stock market opened Tuesday’s trading session on mixed footing as doubts around OpenAI (OPAI.PVT) dragged down the tech sector and the UAE’s announcement that it is leaving the OPEC bloc rocked oil markets.

The Nasdaq Composite (^IXIC) sank 1.1% to lead losses, while the S&P 500 (^GSPC) pulled back 0.4% on the heels of Monday’s record-high closes. Meanwhile, the Dow Jones Industrial Average (^DJI), which includes fewer tech stocks, rose 0.4%.

News that OpenAI reportedly fell short of its targets for sales and users sent shares in partners such as Oracle (ORCL) down. The news comes as five of the “Magnificent Seven” stocks prepare to report earnings on Wednesday and Thursday.

Also, on Tuesday morning, the UAE announced that it is leaving OPEC at a moment when global energy markets are already on edge. Brent crude (BZ=F) briefly rose above $112 per barrel (last trading at around $104) to erase all of its ceasefire-driven losses, per Bloomberg data, while US WTI crude (CL=F) climbed back over $100.

Earnings season is coming down to guidance.

Catching bids: Omnicell ( OMCL) is the biggest mover on the board, up more than 20% premarket after beating Q1 expectations and raising 2026 guidance. LGI Homes (LGIH) is up 10% after lifting its full-year margin outlook, while Centene (CNC) is adding 3% after a strong profit beat and higher revenue forecast. Coca-Cola (KO) is also trading higher after better-than-expected earnings and a higher profit outlook.

The misses: Corning (GLW) is down a little under 10% even though it is still up over 90% year-to-date, with investors looking past a Q1 beat and focusing on a softer-than-expected Q2 sales outlook. Spotify (SPOT) is off similarly after its Q2 profit and premium-subscriber outlook missed expectations. UPS (UPS) is down almost 5% after reporting lower quarterly revenue and adjusted EPS, even as management reiterated its full-year outlook.

The read-through is pretty straightforward: Investors are still rewarding companies that can raise the bar, but they are not giving much room to stocks that already had big runs into earnings.

And this is still before Wednesday’s post-bell barrage from four of the “Magnificent Seven”: Alphabet (GOOGL), Microsoft (MSFT), Meta (META), and Amazon (AMZN).

The United Arab Emirates, one of the world’s major oil producers, will leave the Organization of Petroleum Exporting Countries (OPEC/OPEC+) effective May 1.

The surprise move from Abu Dhabi is likely to deeply shake the oil producer alliance. OPEC+ derives much of its power from a strong consensus and its ability to influence global oil prices thanks to the production power of its members.

The decision “reflects the UAE’s long-term strategic and economic vision and evolving energy profile,” the UAE’s state news agency WAM said in its announcement on Tuesday morning. It is based on“our national interest and our commitment to contributing effectively to meeting the market’s pressing needs,” WAM added.

While Saudi Arabia has long been seen as the dominant voice among the group of 12 countries, the UAE has in recent years seen its strategic influence rise. The country has strengthened both its oil production and its Abu Dhabi National Oil Company, which has raised its international profile.

The UAE’s decision to exit the cartel comes at a markedly precarious moment for Middle Eastern oil powers, which have seen their ability to export oil out of the Persian Gulf cut to near-zero as Iran has asserted military dominance over the Strait of Hormuz, the world’s most critical chokepoint for global energy flows.

Read more here.