{"id":19003,"date":"2026-02-05T11:23:29","date_gmt":"2026-02-05T11:23:29","guid":{"rendered":"https:\/\/microvibenews.com\/?p=19003"},"modified":"2026-02-05T11:23:29","modified_gmt":"2026-02-05T11:23:29","slug":"down-arrow-button-icon-130","status":"publish","type":"post","link":"https:\/\/microvibenews.com\/?p=19003","title":{"rendered":"Down Arrow Button Icon"},"content":{"rendered":"

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S&P 500 futures were flat-to-up this morning before the markets opened in New York, a sign that traders may be temporarily sated after the carnage they wreaked in the stock markets over the last few days. The index fell 0.51% yesterday, closing at 6,882, after spending much of the previous month flirting with the 7,000 level.<\/p>\n

Markets were flat or down globally this morning, with the worst performer being South Korea\u2019s KOSPI, which lost 3.86%.<\/p>\n

The damage came from the tech and software sector, as investors began to realize that the promise of AI won\u2019t always be sunshine and roses. Until recently, the markets had assumed that companies would be buoyed by the massive amount of capex going into AI, and that AI would generate new efficiencies and higher productivity that would ultimately result in higher revenues and earnings per share. Over the last few days, however, traders have reacted to the notion that AI also has the power to destroy the revenues of companies reliant on selling traditional software that can be replaced by AI.\u00a0<\/p>\n

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As much as $1 trillion was wiped off the market cap of software companies yesterday, according to Bloomberg. Alphabet closed down nearly 2% yesterday and lost a further 2.53% overnight after revealing on its earnings call that it planned to double AI capex. The beat down on Alphabet shares came despite better-than-forecast revenue growth that indicates the company\u2019s advertising sales are in no way being cannibalized by consumer adoption of AI, including its own Gemini AI chatbot and its \u2018AI Mode\u2019 in Google Search.<\/p>\n

That\u2019s a problem because until very recently the performance of the S&P 500 was governed by the heavy weight of tech stocks, like Alphabet, within it. \u201cBy the end of 2025, the 10 largest companies accounted for nearly 41 percent of the S&P 500\u2019s total weight,\u201d according to RBC Wealth Management.<\/p>\n

But the chaos is mostly a tech-only phenomenon, the data says. The equal-weight S&P 500\u2014a notional index that values each of the 500 companies equally rather than by total market cap\u2014is actually at a record high this morning because the non-tech companies inside it are doing rather well.<\/p>\n

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\u201cTech stocks are being squeezed sharply, but a lot of broader indices are still holding up for the most part,\u201d Jim Reid and his team at Deutsche Bank told clients this morning.\u00a0 There were \u201c363 advancers in the S&P 500 [yesterday], which was actually the most in two weeks.\u201d\u00a0<\/p>\n

People are buying stocks, just not tech stocks. <\/p>\n

So who is behind this selective buying? Retail traders who love to buy the dip, according to Axios. Retail buyers\u2014ordinary folks trading their own accounts\u2014used to be referred to as \u201cthe dumb money\u201d among the institutional investors of Wall Street because they historically waited too long to jump into bull markets and sold too late into bear markets, the opposite of what you\u2019d want to do.<\/p>\n

Things have changed, however. Retail buyers form a much larger part of the market than they used to\u2014via platforms like Robinhood\u2014and have consistently jumped on the dips, especially since \u201cLiberation Day\u201d last year when President Trump\u2019s tariff plan lopped something like 15% off the S&P before rebounding by 38% by the end of the year, trough to peak.<\/p>\n

So, are this morning\u2019s S&P futures buyers right? Is the selloff over? \u201cIt is very hard to say that this U.S. tech correction has legs, but a fully invested buy-side does look vulnerable to any bad news.\u201d ING\u2019s Chris Turner told clients this morning.<\/p>\n

Here\u2019s a snapshot of the markets ahead of the opening bell in New York this morning:<\/strong><\/p>\n

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  • S&P 500<\/strong> futures were up 0.16% this morning. The last session closed down 0.51%.\u00a0<\/li>\n
  • STOXX Europe 600<\/strong> was flat in early trading.\u00a0<\/li>\n
  • The U.K.\u2019s FTSE 100<\/strong> was down 0.14% in early trading.\u00a0<\/strong><\/li>\n
  • Japan\u2019s Nikkei 225<\/strong> was down 0.88%.\u00a0<\/strong><\/li>\n
  • China\u2019s CSI 300<\/strong> was down 0.6%.\u00a0<\/strong><\/li>\n
  • The South Korea KOSPI <\/strong>was down 3.86%.\u00a0<\/strong><\/li>\n
  • India\u2019s NIFTY 50<\/strong> was down 0.57%.\u00a0<\/strong><\/li>\n
  • Bitcoin<\/strong> declined to $71.2K.<\/li>\n<\/ul>\n<\/div>\n
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