NEW YORK (AP) — U.S. Stock markets finished Tuesday with modest gains after a day of fluctuating trading, as concerns about consumer spending and the impact of artificial intelligence weighed on investor sentiment. The S&P 500 closed at 6,843.22, a gain of 0.1%, while the Dow Jones Industrial Average rose 32.26 points to 49,553.19. The Nasdaq composite edged up 0.1% to 22,578.38.
The day’s trading was marked by a stark contrast between sectors. Entertainment company Paramount Skydance saw a 4.9% increase after Warner Bros. Discovery indicated it would allow Paramount to submit a final bid for the company, potentially topping an offer from Netflix. Warner Bros. Discovery rose 2.7%, and Netflix added 0.2%. However, these gains were offset by declines in other areas, particularly among companies signaling weakening consumer demand.
General Mills experienced a significant 7% drop after lowering its profit forecast for 2026, citing growing unease among its customers. The company, known for brands like Cheerios and Pillsbury, indicated that declines in sales would be more pronounced than previously anticipated. This follows recent surveys indicating weak confidence among U.S. Households, grappling with persistent inflation and a sluggish job market. According to the CNN Business report from February 18, 2026, these factors are contributing to a cautious consumer outlook.
Genuine Parts, a supplier of auto and industrial replacement parts, too contributed to the day’s mixed performance, falling 14.6% after reporting weaker-than-expected quarterly results. The company announced plans to split into two publicly traded entities in early 2027, separating its automotive and industrial parts businesses.
Big Tech stocks experienced volatility, with Alphabet falling 1.2%. Nvidia, a key player in the AI sector, saw fluctuating performance, initially weighing on the market before recovering. According to Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute, markets need to see stabilization in these key tech companies and a reduction in “sell first/ask questions later” behavior from investors.
The recent turbulence in the tech sector stems from concerns about the potential disruption caused by artificial intelligence. Investors have been reassessing companies that may be vulnerable to competition from AI-powered rivals, leading to sharp sell-offs in industries ranging from software to legal services. Simultaneously, companies heavily investing in AI are facing scrutiny over the potential for overspending, with Alphabet’s planned investment of roughly $180 billion in AI and other initiatives raising concerns about future profitability. A Bank of America survey revealed a record percentage of fund managers believe companies are “overinvesting” in AI, potentially leading to a pullback in spending on related technologies.
In overseas markets, European indexes rose following a quiet day in Asia, where many markets were closed for Lunar New Year celebrations. Japan’s Nikkei 225 slipped 0.4%, influenced by weak economic data and a 5.1% decline in shares of SoftBank Group.
Treasury yields remained relatively stable, with the yield on the 10-year Treasury edging up to 4.05% from 4.04% late Friday.
