Gotrade News - Wall Street closed in the red on Tuesday as the latest economic data failed to impress. Investors are now playing the waiting game, keeping their powder dry ahead of the crucial consumer price report.
Key Takeaways:
US retail sales flatlined at 0%, raising red flags about an economic slowdown.
Fears of AI disruption hammered the financial sector following the launch of a new tax tool.
Capital rotation is in full swing as the Dow Jones defies the trend to hit a fresh record high.
The US Census Bureau reported that December retail sales stagnated, showing zero growth compared to the previous month. The print missed the mark significantly, trailing the 0.4% gain analysts had penciled in.
The S&P 500 (SPY) dipped 0.3%, while the tech-heavy Nasdaq took a harder hit, sliding 0.6% on Tuesday (10/02). The pullback signals the market's growing anxiety over whether the consumer engine is starting to sputter.
Bearish sentiment was also fueled by concerns over the massive capex required for the AI arms race. Google just offloaded $20 billion in bonds to fund its aggressive tech expansion.
Financial stocks took it on the chin after a new AI-powered tax planning tool hit the market. CNBC reported that shares of LPL Financial plunged 8.3% as the threat of automated competition spooked traders.
In a twist, the Dow Jones moved against the grain, managing to clinch a new closing record. This divergence points to a flight to safety, with investors rotating cash into more defensive industrial plays.
Traders are now pricing in a 36% chance of an April rate cut. CME Group data shows these odds ticking up as the softer economic data gives the Fed more food for thought.
All eyes are now locked on Friday’s inflation print. The incoming CPI data will be the final piece of the puzzle determining the Fed's next move.
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Reference:
Seeking Alpha, S&P 500, Nasdaq end lower after the latest retail sales data. Accessed on February 11, 2026
CNBC, S&P 500 closes lower as AI fears weigh on financial stocks; Dow hits another record. Accessed on February 11, 2026
The Standard, S&P 500, Nasdaq dip with economic data, earnings in focus. Accessed on February 11, 2026
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