Stocks Retreat on AI Disruption Concerns and Geopolitical Risks

Economic Indicators - The US February MNI Chicago PMI unexpectedly rose by 3.7 points to 57.7, marking the fastest pace of expansion in 3.75 years, contrary to expectations of a decline to 52.1 [2] - The US January PPI final demand increased by +0.5% month-over-month and +2.9% year-over-year, exceeding expectations of +0.3% month-over-month and +2.6% year-over-year [2] - Stock indexes recovered from their worst levels following the positive economic indicators, indicating signs of economic strength [2] Stock Market Performance - The S&P 500 Index is down -0.61%, the Dow Jones Industrial Average is down -1.17%, and the Nasdaq 100 Index is down -0.41% [4] - Stock indexes added to previous losses, with the Dow Jones Industrial Average falling to a 3.5-week low due to concerns over AI's disruptive potential and weak performance in software and cybersecurity stocks [3][4] Earnings Reports - More than 90% of S&P 500 companies have reported earnings, with 74% beating expectations, and S&P earnings growth is expected to climb by +8.4% in Q4, marking the tenth consecutive quarter of year-over-year growth [6] - Dell Technologies reported a Q4 adjusted operating income of $3.54 billion, exceeding the consensus of $3.27 billion, and raised its annual dividend by 20% while boosting its stock buyback program by $10 billion, leading to a +19% increase in its stock price [17] Sector Performance - Chipmakers are experiencing declines, with NXP Semiconductors NV and Qualcomm down more than -2%, contributing to the overall market weakness [11] - Cybersecurity stocks are also down, with Zscaler leading the decline at more than -15%, despite reporting better-than-expected Q2 adjusted EPS [12] - Airline stocks are sliding due to rising WTI crude oil prices, with United Airlines Holdings down more than -8% [14] International Markets - Overseas stock markets are mixed, with the Euro Stoxx 50 down -0.52% and China's Shanghai Composite up +0.39% [7]