22.07.202613:38:15UTC+00US Stocks Pull Back

US stock indices were mostly lower on Wednesday, as a pullback in the AI-driven rally coincided with expectations of prolonged higher interest rates. The S&P 500 edged down, while the Nasdaq 100 lost more than 1%. Micron, Intel, and SanDisk each fell nearly 4%, and Nvidia also ticked lower. The sector remained volatile, underscoring uncertainty over whether AI hyperscalers will keep expanding their hardware orders.

Further clarity on the AI trade is expected after the close with Alphabet’s earnings report, its first update since last quarter’s increase in capital expenditures. Tesla, which is also scheduled to report, slipped 0.5% and recently approached its lowest level since April.

Geopolitical tensions between the US and Iran intensified after Secretary of State Rubio played down prospects for diplomacy, heightening energy inflation concerns and pushing yields higher. Financial stocks weakened, with American Express down 1%. In contrast, the Dow hovered slightly above the flatline. AT&T gained more than 4% after an earnings beat, providing a lift to other telecom names.