US stocks ended Tuesday with a quiet finish after sharp swings underneath the surface as investors weighed uncertainty around artificial intelligence and the broader economy. The S&P 500 closed up 0.1% after trading earlier between a gain of 0.5% and a loss of nearly 1%, while the Dow gained 32 points, or 0.1%, and the Nasdaq Composite rose 0.1% to 22,578.38, according to market results reported by the Associated Press.
The day’s biggest single driver among individual winners came from the media sector. Paramount Skydance rose 4.9% after Warner Bros. Discovery said it would allow Paramount to submit its “best and final” bid to buy the entertainment company. Warner Bros. Discovery rose 2.7%, while Netflix ended up 0.2% as the deal process continued.
Consumer and industrial outlook concerns weighed on parts of the market. General Mills fell 7% after the company warned that its customers are feeling uneasy and cut its forecast for an underlying measure of profit for 2026, saying declines were likely to be sharper than it had earlier expected. The pullback echoed broader pressure from surveys described in the report, which pointed to weak household confidence as inflation stays higher than desired, growth comes off a weak year, and worries about tariffs persist.
Other companies also signaled caution. Genuine Parts, which sells auto and industrial replacement parts, reported weaker-than-expected results for its latest quarter and said it was “navigating a dynamic environment.” The company also said it plans to split into two publicly traded companies in early 2027, with one focused on auto parts and the other on industrial parts; its stock fell 14.6% on the day.
In technology, investors continued to rotate between AI enthusiasm and renewed skepticism. Alphabet fell 1.2% and some “Big Tech” names were among the heaviest drags, while Nvidia swung during the session between being one of the market’s largest weights and one of its biggest strengths. Market strategists and investors were not uniformly pulling back from AI exposure, but the report described a sensitivity to how quickly AI-linked demand and spending translate into profits.
Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute, said the market needs Big Tech companies to stabilize and “need to see less sell first/ask questions later behavior from investors.” Chris Larkin, managing director of trading and investing at E-Trade from Morgan Stanley, described a pattern in which stocks have been near record levels overall but do not feel that way to some investors because sharp sell-offs have disrupted rebounds soon after they start.
The report also pointed to a wider shift from the prior year’s rally-driving narrative. It said Wall Street’s turnaround from earlier momentum has left investors quick to punish companies in industries as varied as software, legal services and trucking when worries flare that AI-powered competitors could steal customers. At the same time, the companies that are spending heavily on AI faced their own pressure, with global fund managers described as concerned about the risk that firms are over-investing in AI data centers and chips.
The AP report cited an example of that spending pressure, saying Alphabet has said its spending on AI and other investments could double this year to roughly $180 billion. It also said a Bank of America survey of global fund managers found a record percentage saying companies are “overinvesting,” which could eventually lead to a pullback in chip spending from Nvidia and other firms.
In bond markets, Treasury yields held relatively steady. The yield on the 10-year Treasury edged up to 4.05% from 4.04% late Friday, according to the AP report. In global trading, European indexes rose following a quieter day in Asia where most markets were closed for Lunar New Year holidays, while Japan’s Nikkei 225 slipped 0.4% and SoftBank Group fell 5.1%.
The report said weak economic data for Japan contributed to the slide, and SoftBank’s decline followed a rally after a Feb. 8 general election appeared to clear the way for Prime Minister Sanae Takaichi’s ruling party to push through policies to help the economy. The AP story totaled the major indexes’ closes: the S&P 500 added 7.05 points to 6,843.22, the Dow rose 32.26 to 49,553.19, and the Nasdaq Composite gained 31.71 to 22,578.38.
As markets weighed AI and inflation worries, the session left the indices little changed at the close, even as company-level outcomes reflected a sharper debate over consumer strength and whether AI-led investment plans can quickly deliver the returns investors expect.