Alphabet Leads the Sell-Off
Wall Street suffered a broad decline on Thursday after Alphabet, Google’s parent company, dropped more than 4%, dragging major indexes down. The S&P 500 fell 1.2%, the Dow lost 606 points, and the Nasdaq slipped 1.5%, marking a sixth loss in seven sessions since the S&P 500 hit a record high.
Despite reporting stronger-than-expected quarterly profits, Alphabet’s announcement that it could double its spending on equipment and investments to roughly $180 billion (€152bn) unsettled investors. This figure far exceeded analyst expectations of $119 billion (€100.5bn), raising concerns about rising costs in the tech sector.
Weak Job Reports Shake Bonds and Economy
Adding to market jitters, US job data suggested the labor market may be softening. Weekly unemployment claims rose more than economists predicted, while employers announced 108,435 planned layoffs in January — the worst January for job cuts since 2009. Job postings also dropped to a five-year low in December.
Treasury yields fell in response, with the 10-year note dropping to 4.21%. Economists warn that continued labor market weakness could pressure the Federal Reserve to cut interest rates to support growth, even as inflation remains a concern.
Commodities and Crypto Face Volatility
Commodities and cryptocurrencies also saw steep swings. Silver plunged 13.3%, while gold fell 2.3% to $4,838.80 (€4,087.50) per ounce after months of dramatic fluctuations. Bitcoin dropped below $68,000 (€57,432), down from its October peak above $124,000 (€104,730), pulling down crypto-linked stocks like Coinbase and Strategy.
Some companies bucked the trend. Chipmaker Broadcom rose 3.7%, benefiting from the AI investment frenzy, and healthcare firm McKesson jumped 16.8% after reporting strong earnings. International markets mirrored the US weakness: London’s FTSE 100 fell 0.9%, Germany’s DAX dropped 0.9%, France’s CAC 40 lost 0.7%, and South Korea’s Kospi tumbled 3.9%, with Samsung Electronics down 6% following a recent surge.
