Wall Street: Nasdaq Falls 1.5%, Dragged Down by AMD’s Sharp Sell-Off

Posted on February 4, 2026 by Ignacio Teson

During the session, weaker-than-expected U.S. labor market data were released, while investors also awaited Google’s earnings report.

Could a crash be coming for the stock market?

Major Wall Street indexes closed mixed on Wednesday, February 4. Technology stocks extended their decline, weighed down by a sharp post-earnings sell-off in chipmaker Advanced Micro Devices, Inc. (AMD).

At the same time, investors digested softer labor market indicators while looking ahead to the release of Alphabet’s (Google’s parent company) closely watched quarterly results after the closing bell.

In this context, the Dow Jones Industrial Average rose 0.5% to 49,500.90 points, the S&P 500 slipped 0.5% to 6,882.76, and the Nasdaq Composite fell 1.5% to 22,904.58.

[[SPX-graph]]

ADP payrolls rise less than expected

Beyond corporate news, data released early in the session showed that U.S. private-sector employment increased less than expected in January, reflecting job losses in professional and business services as well as in manufacturing.

Payrolls rose by 22,000 jobs, following a downwardly revised gain of 37,000 in December, according to ADP’s National Employment Report. The figure came in well below the expected increase of 50,000.

A temporary government shutdown delayed the release of the highly anticipated monthly employment report until earlier this week, meaning ADP’s figures currently provide the clearest snapshot of labor market conditions in January.

Another indicator published during the day showed activity in the U.S. services sector—which accounts for more than two-thirds of national output—held steady in January. The Institute for Supply Management’s non-manufacturing PMI remained unchanged at 53.8, above consensus expectations. A reading above 50 typically signals expansion in the services sector.

Scott Bessent and support for a strong dollar

Treasury Secretary Scott Bessent underscored the importance of Federal Reserve independence for monetary policy during his testimony before the House Financial Services Committee on Wednesday.

He said the Fed must maintain a “very delicate balance” to fulfill its dual mandate, warning that when the central bank “moves into other areas, it affects its independence.” He also stated that the Fed “lost the public’s trust when inflation devastated the nation,” while reaffirming his belief in both the Fed’s independence and its accountability.

On financial regulation, Bessent cautioned against striving for a “zero-risk financial system,” while clarifying that he does not advocate “financial deregulation at any cost.”

Earnings in focus and standout Wall Street stocks

The AI-related segment of the market remained subdued on Wednesday, as shares of Advanced Micro Devices (AMD) plunged 17.3% after the company issued disappointing guidance, despite reporting record fourth-quarter revenue of $10.3 billion.

In other earnings-related moves, Eli Lilly shares surged 10.3% after the pharmaceutical company delivered an upbeat sales outlook for the year, driven by strong demand for its weight-loss drugs.

Bitcoin Sell-Off Deepens, Fueling Investor Concerns Over an Uncertain Rebound

Posted on February 4, 2026 by Ignacio Teson

The recent sell-off pushed Bitcoin sharply lower, bringing it close to the lows seen in early 2025. However, according to experts, the situation this time is different.

Bitcoin falls once more and could be in a long bearish trend now.

Bitcoin (BTC) has extended its decline and is trading around $72,000 following last weekend’s rout, posting losses of nearly 18.7% over the past seven days. The downturn has spilled over into the broader crypto market, with most altcoins also trading in negative territory.

On Wednesday, the flagship cryptocurrency is down 3.5% at $72,800, a level close to where it traded in 2024. Ethereum (ETH), meanwhile, is falling 4.7% to $2,120, bringing its seven-day loss to 29%.

[[BTC/USD-graph]]

Among major alternatives, Solana is leading the declines with a daily drop of 9.1%, followed by BNB (-4.7%). By contrast, WhiteBIT Coin stands out as the only major crypto asset posting gains, up 5.5%.

Why does a Bitcoin recovery look difficult?

The latest drop has driven Bitcoin back toward levels close to its early-2025 lows. While price action may appear similar at first glance, on-chain data suggest that the underlying market structure is markedly different this time.

During the April 2025 sell-off, when Bitcoin fell to around $75,000, only 25.76% of the circulating supply was above that level. By comparison, current data show that roughly 44.86% of supply now sits above $75,000. This creates a much stronger resistance to any short-term recovery, as a larger number of holders are either at a loss or near breakeven within the current trading range.

For Ethereum, the comparable support level lies near $1,900, reflecting similar dynamics across altcoin markets, which tend to mirror Bitcoin’s behavior during corrective phases.

The Bank of Japan Pulls Back from Bond Intervention Despite Rising Volatility

Posted on February 4, 2026 by Ignacio Teson

The central bank believes that intervention would pose more risks than benefits and could further weaken the yen.

Japan’s Prime Minister Sanae Takaichi may not receive support from the Bank of Japan (BoJ) to curb the sharp rise in government bond yields. The cost of intervention is seen as too high and could trigger an additional slide in the yen, which is already under pressure ahead of the February 8 elections.

According to Reuters, three sources familiar with the central bank’s thinking said recent market moves have not reached the threshold required to justify intervention—an option that was discussed at the BoJ’s January 22–23 policy meeting.

At that meeting, one board member warned about a “one-sided rise” in the yield curve, while another flagged heightened volatility in ultra-long-dated bonds. BoJ Governor Kazuo Ueda also struck a more cautionary tone, describing the pace of the rise in yields as “quite rapid,” although markets have since regained some stability.

[[USD/JPY-graph]]

Elections and fiscal risks

Japanese government bonds (JGBs) came under heavy selling late last month, unsettling global debt markets given Japan’s role as the funding source for one of the world’s largest carry trades, thanks to its historically low borrowing costs.

The sell-off was triggered by Prime Minister Takaichi’s call for snap elections and her pledge to suspend a food tax for two years—a proposal that raised concerns about increased fiscal spending in a country already burdened with one of the highest public debt levels globally.

Growing expectations that Takaichi’s party could secure a decisive victory have kept investors on edge. A strong mandate at the polls would give her greater leeway to pursue expansionary fiscal policies, intensifying worries over the sustainability of Japan’s public finances.

This backdrop leaves the Bank of Japan in a difficult position. Any attempt to cap long-term bond yields would run counter to its gradual rate-hiking strategy, aimed at containing inflationary pressures stemming from the yen’s prolonged depreciation.

Asian Markets Wobble as Software Stocks Face Heavy Sell-Off

Posted on February 4, 2026 by Ignacio Teson

Stock markets across several countries were shaken by a broad unwinding of positions in traditional technology companies. Investors remain closely focused on developments at Anthropic, particularly the rollout of its Claude Cowork agent and its expanding programming capabilities.

Software Companies are being affected by AI.

Asian equities opened Wednesday with pronounced volatility, against a challenging global backdrop following sharp declines on Wall Street and in major European markets. Investor concerns are increasingly centered on how recent advances in artificial intelligence could disrupt the traditional software industry and its underlying business models.

The cautious mood contrasted with movements in some commodities. Oil prices advanced after the United States shot down an Iranian drone and armed vessels approached a U.S.-flagged ship along a key maritime route, heightening tensions in the Middle East. At the same time, precious metals rebounded following steep losses in recent sessions.

Unwinding in traditional software

Selling pressure was particularly concentrated in data analytics, professional services, and software companies across the United States and Europe. The move intensified after Anthropic last Friday unveiled add-ons for its Claude Cowork agent, a launch that reignited fears of structural disruption across these sectors as AI capabilities accelerate.

In Asia, while some software-related firms followed the global downturn, selling pressure was more contained. The region’s heavier exposure to hardware manufacturing helped cushion the broader correction. Even so, China’s CSI Software Services Index fell 3%, while major technology groups listed in Hong Kong declined 1.8%.

Japan saw some of the sharpest early moves. Shares of advertising group Dentsu dropped more than 6%, while Nomura Research Institute slid nearly 8%. The Nikkei index was down 0.8%.

By contrast, the MSCI Asia-Pacific index excluding Japan managed to hold a marginal gain of 0.1%. Meanwhile, U.S. futures pointed to a weak open: Nasdaq futures fell 0.12% after losing more than 1% in the previous session, while S&P 500 futures were little changed. In Europe, EUROSTOXX 50 futures slipped 0.1%, while FTSE futures edged up 0.08%.

The unease echoes last week’s market reaction, when Microsoft shares fell despite strong earnings, amid fears of potential disruptions to its software business. That instability has carried into this week, underscoring that technology is not a uniform winner in the AI cycle and that pockets of vulnerability remain.

Against this backdrop, some markets managed to break away from the broader weakness. South Korea’s KOSPI, with its heavy technology weighting, rose 1.4%, while Taiwanese equities gained 0.2%.

Wall Street Slid as much as 1.4%, Dragged Down by Losses in Tech

Posted on February 4, 2026 by Ignacio Teson

The announcement of a trade agreement between India and the United States was overshadowed by the departure of PayPal’s CEO. Against that backdrop, the Nasdaq led losses among New York’s main benchmarks.

Wall Street Wobbles as Overvaluation Worries and Macro Uncertainty Hit Sentiment

Wall Street’s major indexes fell on Tuesday, February 3, with technology stocks sliding sharply amid sector rotation and disappointing quarterly earnings. Monday’s bond selloff also weighed on equities, even as gold and silver prices rebounded after suffering steep losses.

The Dow Jones Industrial Average slipped 0.3% to 49,241.06 points, the S&P 500 dropped 0.9% to 6,917.18, and the Nasdaq Composite fell 1.4% to 23,255.19.

[[SPX-graph]]

Markets react to geopolitical headlines

All three benchmark indexes came under pressure following reports that the United States shot down an Iranian drone that had approached a U.S. Navy aircraft carrier.

“According to the White House, the United States shot down an Iranian drone,” press secretary Karoline Leavitt confirmed on Tuesday during an interview on Fox News’ America Reports, corroborating earlier media reports.

Despite the incident, Leavitt said that previously scheduled talks with Iran are still expected to proceed later this week.

Treasuries and metals in focus

U.S. Treasury yields moved higher after stronger-than-expected U.S. manufacturing data released on Monday. Meanwhile, gold and silver prices rebounded sharply after posting historic losses in the prior session.

Earnings season takes center stage

More than 100 companies in the S&P 500 are set to report earnings this week, a flow of results that is likely to set the tone for markets in the days ahead.

Shares of AI favorite Palantir Technologies surged 6.8% after the data analytics firm posted record fourth-quarter 2025 revenue of $1.41 billion, driven by strong demand for its AI-enhanced tools from government and corporate clients.
PayPal, by contrast, plunged 20.2% after the payments technology company missed quarterly expectations and announced the appointment of a new chief executive.
Novo Nordisk shares sank 14.7% after the Danish pharmaceutical company warned of a significant slowdown in commercialization growth for 2026.

Mexican Peso Extends Gains Against the Dollar for a Second Straight Day

Posted on February 3, 2026 by Ignacio Teson

The Latin American currency advanced in a market focused on the partial shutdown of the U.S. government, which has suspended the release of key labor data closely watched by the Federal Reserve.

The Mexican peso strengthened against the dollar for a second consecutive session on Tuesday. The local currency gained ground as investors monitored developments surrounding the partial shutdown of the U.S. government, which has delayed the publication of labor market indicators critical for the Fed’s policy decisions.

The exchange rate ended the session at 17.2599 pesos per dollar. Compared with Monday’s LSEG reference price of 17.3927—there was no official Banco de México (Banxico) fixing due to a local holiday—the peso posted a gain of 13.28 centavos, or 0.76%.

The dollar traded within a range of a high of 17.4096 pesos and a low of 17.2062. The U.S. Dollar Index (DXY), which tracks the greenback against a basket of six major currencies, slipped 0.18% to 97.43 points.

[[USD/MXN-graph]]

Analysts expect the peso’s recovery to continue after failing to break above resistance at 17.45. The next support level that could come into play is seen around 17.28. They recommend maintaining current positions.

Fed Lacks Key Data

The U.S. House of Representatives made progress on a spending bill aimed at ending the partial government shutdown. The legislation would fund federal agencies through October, but Democrats have sought to block it amid negotiations over immigration policy.

This week’s economic calendar features key U.S. labor market reports, including nonfarm payrolls and the unemployment rate—both crucial for shaping monetary policy expectations. However, the JOLTS job openings report scheduled for Tuesday was postponed.

After the Metals Rout

Precious metals plunged on Friday following news that Kevin Warsh, a former Federal Reserve governor, had been nominated as the preferred candidate to lead the central bank once Chair Jerome Powell’s term ends in May.

Markets are looking for clues on the future path of U.S. interest rates, amid expectations that rate cuts could proceed at a slower pace this year. Futures markets tracked by CME’s FedWatch tool currently price in two rate cuts for 2026.

Fed Governor Stephen Miran said in an interview with Fox Business Network that he continues to advocate for aggressive rate cuts. Meanwhile, Richmond Fed President Thomas Barkin noted that earlier cuts have contributed to a healthier labor market.

Focus Shifts to Banxico

On the domestic front, traders are bracing for Banxico’s first monetary policy decision of the year. The central bank is expected to keep interest rates unchanged in the first quarter, although its previous statement left the door open for potential adjustments later on.

Separately, the government announced a 2026–2030 infrastructure investment plan totaling 5.6 trillion pesos, to be carried out through public-private partnerships. The investment will target eight strategic sectors, including energy, railways, and ports.

Pepsi Soars and Emerges as One of the Market’s Top Defensive Plays

Posted on February 3, 2026 by Ignacio Teson

Shares of PepsiCo rose more than 4% in a single session following the release of its quarterly earnings, reinforcing its position as one of the market’s strongest defensive plays.

Pepsi is being labeled a top defensive pick.

Pepsi, Coca-Cola’s main rival, reported fiscal fourth-quarter 2025 results that slightly exceeded Wall Street expectations, pushing its stock sharply higher.

For the period ended December 27, 2025, the company posted total revenue of US$29.34 billion, up 5.6% year over year and above the analyst consensus of roughly US$28.9 billion. Adjusted earnings per share (EPS) came in at US$2.26, beating expectations by US$0.02.

Operating performance: what’s behind Pepsi’s growth?

Revenue growth was driven mainly by price increases and productivity gains, even as sales volumes continued to show signs of weakness. In North America, volumes declined by about 1% in snacks and nearly 4% in beverages, highlighting softer consumer demand in the company’s core market.

Pepsi attributed much of its resilience to stronger international demand, particularly in emerging markets, where localized flavors and targeted product categories helped offset slower momentum at home.

Strategic adjustments and market response

In response to shifting consumption patterns and pressure on demand, Pepsi announced a series of strategic initiatives aimed at improving competitiveness:

Price reductions on key products, with suggested cuts of up to 15% on brands such as Lay’s, Doritos, Ruffles, and Tostitos, addressing consumer concerns over affordability after years of price hikes.
Portfolio simplification and product line cuts, focusing on higher-growth and more profitable brands.
Innovation in healthier and functional products, including offerings with added protein or functional benefits, alongside the repositioning of iconic brands such as Pepsi Prebiotic.

These moves are part of a broader strategy partly driven by pressure from activist investor Elliott Investment Management, which has pushed for operational improvements and a more aggressive focus on consumer value.

Outlook and shareholder returns

Alongside its solid quarterly results, Pepsi announced a 4% dividend increase and a US$10 billion share buyback program, signaling confidence in its long-term cash-generation capabilities.

For fiscal year 2026, the company reaffirmed its guidance for organic revenue growth of 2%–4% and adjusted EPS growth of 5%–7%, supported by productivity initiatives, innovation, and international expansion.

Trump Announces Tariff Cuts for India for Ending Russian Oil Purchases

Posted on February 3, 2026 by Ignacio Teson

However, the details of the agreement remain unclear. The announcement caught markets by surprise, as progress in the negotiations had been kept strictly confidential.

India is strengthening its alliance with the west.

U.S. President Donald Trump announced Tuesday morning that the United States will cut tariffs on Indian goods from 50% to 18% in exchange for India halting its purchases of Russian oil and instead sourcing crude from the United States and Venezuela. “This will help bring an end to the war in Ukraine,” Trump said.

So far, Trump’s social media post has not been followed by any official details from either the White House or the Indian government. Under the agreement as outlined by Trump, the U.S. will lower its tariffs on Indian products below those applied to most Asian countries. In addition to cutting the reciprocal tariff from 25% to 18%, Washington will also remove an extra 25% punitive tariff tied specifically to India’s purchases of Russian oil.

Trump said Indian Prime Minister Narendra Modi agreed to buy US$500 billion worth of American products, reduce Indian tariffs to zero, and stop importing Russian crude—one of Washington’s key demands. While Modi has not publicly confirmed the specifics of the deal, officials on both sides welcomed the announcement, and investors reacted positively to the news.

The Russian Oil Dilemma

That said, Indian refineries are likely to require a transition period to unwind existing oil supply agreements with Russia before imports can be fully halted. According to Reuters, the Indian government has not yet instructed refiners to stop buying Russian crude.

Meanwhile, the government of Russian President Vladimir Putin said it has received no official communication from India regarding a suspension of oil purchases.

In this context, credit rating agency Moody’s warned that an abrupt halt to Russian oil imports could disrupt India’s economic growth. “A complete shift away from non-Russian oil could also tighten global supply, push prices higher, and lead to increased inflation, given that India is one of the world’s largest oil importers,” the agency said.

Wall Street Starts February Higher and Silver Jumps 11%

Posted on February 3, 2026 by Ignacio Teson

The Dow Jones Industrial Average rose 1.05% to 49,407.66 points, the S&P 500 gained 0.57% to 6,978.65, and the Nasdaq Composite advanced 0.56% to 23,592.11.

Silver’s Momentum Reset Sets the Stage for the Next Leg Higher

Wall Street’s main indexes closed higher on Monday, February 2, supported by gains in defensive consumer-staples stocks. Investors rebounded from last week’s relentless sell-off in gold and silver and shifted their focus back to trade developments, after President Donald Trump announced a new agreement with India.

In this context, the Dow Jones Industrial Average rose 1.05% to 49,407.66 points, the S&P 500 gained 0.57% to 6,978.65, and the Nasdaq Composite advanced 0.56% to 23,592.11.

[[SPX-graph]]

India moves away from Russian oil

Posting on Truth Social, Trump said he had spoken with Indian Prime Minister Narendra Modi about “many things,” including trade and efforts to end the war between Russia and Ukraine.

“He agreed to stop buying Russian oil and to buy much more from the United States and, potentially, from Venezuela,” Trump said, referring to Modi. India’s purchases of Russian crude had been a major sticking point in trade negotiations with Washington.

Trump also said both leaders agreed on a trade deal under which the U.S. would lower its reciprocal tariff rate on India from 25% to 18%. In exchange, India committed to purchasing more than $500 billion worth of U.S. products.

January jobs report delayed

Media reports on Monday indicated that the U.S. Bureau of Labor Statistics had delayed the release of the January employment report, originally scheduled for Friday, due to the partial government shutdown.

Federal government services were suspended over the weekend after the U.S. Senate passed a temporary funding package covering five appropriations bills on Friday, but the House of Representatives did not return to work until Monday.

The shutdown is not expected to resemble last year’s record-long closure, as lawmakers anticipate that the House will approve the funding package.

Confidence rebounds at the start of February

Market sentiment had been severely hit late last week by a sharp collapse in gold and silver prices. Precious metals were pressured by a stronger dollar and heavy profit-taking following months of strong gains.

[[XAU/USD-graph]]

However, sentiment improved quickly. At the start of the next trading day, spot gold posted one of its strongest daily gains in decades during Tuesday’s Asian session, while spot silver also staged a sharp rebound. Gold surged more than 5%, climbing back above $4,850 an ounce, while silver jumped over 11%, reclaiming levels above $85 an ounce.

Goldman Sachs and J.P. Morgan Bet on Robust Corporate Profits in 2026

Posted on February 2, 2026 by Ignacio Teson

According to Goldman Sachs strategists, earnings forecasts for S&P 500 companies remain solid.

Wall Street operators are ready for the earnings season.

Against a global backdrop marked by volatility and structural shifts in financial markets, two of Wall Street’s leading institutions—Goldman Sachs and J.P. Morgan—are growing increasingly optimistic about the outlook for U.S. corporations heading into 2026.

That confidence is grounded in a combination of strong corporate results, a supportive macroeconomic environment, and a notable equity rotation that is broadening market leadership after years of near-exclusive dominance by mega-cap technology stocks.

Why Goldman Sachs Is Confident in Wall Street Earnings

According to Goldman Sachs strategists, profit forecasts for S&P 500 companies remain healthy. More than half of the firms that have already issued guidance for 2026 have exceeded analysts’ expectations, pointing to resilient and broad-based earnings growth.

Goldman expects the index to finish the year higher, supported by an estimated 12% increase in earnings per share, reflecting the strength of corporate fundamentals across multiple sectors.

This focus on profit growth underpins the bank’s constructive outlook: while the bull market may not replicate the outsized gains seen in 2025, there is growing consensus that ample upside remains, driven by solid fundamentals and an economy that continues to show momentum.

J.P. Morgan shares a similarly upbeat view. Its strategists noted that the current earnings season has delivered “encouraging” results, with capital expenditures supported by strong and expanding profits. This dynamic is helping to broaden the earnings base beyond the sectors that previously led the market.

A Strategic Market Rotation

A key element in both banks’ narrative is the equity rotation that has taken hold on Wall Street. After years in which the so-called “Magnificent Seven” tech giants accounted for much of the market’s performance, investors are increasingly shifting toward mid- and small-cap stocks, as well as cyclical sectors such as materials, healthcare, and consumer industries.

This rotation is not only diversifying sources of returns but also reducing reliance on a handful of mega-cap companies. Looking ahead to 2026, this expanding market breadth could translate into lower vulnerability to sharp corrections and a wider range of opportunities for active investors.