US stocks slipped from their latest record-setting run on Tuesday, as Wall Street weighed worries over the government shutdown against hopes for artificial intelligence.
The Dow Jones Industrial Average (^DJI) fell 0.2%. The S&P 500 (^GSPC) dropped around 0.4%, while the tech-heavy Nasdaq Composite (^IXIC) decreased roughly 0.7% after fresh record high closes on Wall Street.
Gold (GC=F) futures topped $4,000 per ounce for the first time ever, as investors continue to flock to the safe-haven asset.
The pullback in stocks comes after the S&P and Nasdaq both scored their seventh win in a row on Monday, boosted by news of a multibillion-dollar deal between AMD (AMD) and OpenAI (OPAI.PVT) that sent the chip company’s stock rocketing higher.
But the AI trade lost some steam Tuesday, led by a decline in Oracle (ORCL) stock after a report said the profit margin in its cloud computing business was likely lower than many Wall Street forecasts. Shares of Oracle fell as much as 7% throughout the day but closed 2% lower.
Tesla (TSLA) shares also lost steam, dropping 4%, after the EV maker unveiled a cheaper Model Y priced under $40,000 on Tuesday in a launch initially teased in a series of cryptic social media posts.
Earnings results will take on even greater prominence than usual for markets during the US government shutdown. The longer the federal stoppage drags on, the more clouded the picture of the economy will become for investors as key data releases dry up, making it hard to divine the path of interest rates.
It has already delayed the September jobs report that was due Friday. Next week’s releases on consumer and producer inflation, crucial to the Federal Reserve’s decision making, could also be postponed.
Meanwhile, the Washington gridlock on a funding bill continues. President Trump signaled he would negotiate with Democrats over the healthcare subsidies they want to extend but only after the government is reopened. He also amped up threats toward federal workers.
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