Wall Street suffered its fourth consecutive decline Monday, November 17, as investors fled technology stocks ahead of Nvidia’s critical earnings report Wednesday and delayed employment data that could determine whether the Federal Reserve cuts rates in December. The Dow Jones Industrial Average lost 557.24 points, or 1.18%, to close at 46,590.24, while the S&P 500 sank 0.92% to end the day at 6,672.41 and the Nasdaq Composite tumbled 0.84% to settle at 22,708.07.
The S&P 500 slid almost 1%, breaching a technical mark seen by many as a gateway to more losses, with the gauge snapping 138 sessions during which it held above the 50-day moving average, its second-longest stretch this century. The violation of this key technical level triggered additional selling as momentum traders liquidated positions and risk management systems forced institutional investors to reduce exposure.
Nvidia dropped almost 2% ahead of the company’s third-quarter results, which are scheduled for after the bell on Wednesday, demonstrating that even the semiconductor giant that has powered the AI rally faces mounting skepticism about whether massive capital expenditures will translate into proportional revenue growth. The bar is getting higher for the chipmaker to convince investors that the billions spent on artificial intelligence infrastructure will pay off.
The tech-heavy Nasdaq plummeted 3% last week, the index’s largest weekly decline since the aftermath of President Donald Trump’s Liberation Day tariffs in April. The S&P 500 fell 1.6% over that period, ending three consecutive weeks of gains, marking a rare bout of turbulence on this year’s glide path to higher returns.
Conservative investors should recognize that Monday’s decline validates concerns that have been building for months about unsustainable valuations in artificial intelligence stocks. There’s a recognition that if they spend all this money on data centers, it will weigh on their earnings, and it’s not clear at this point how profitable those investments will be, said Ed Yardeni, president of market advisory firm Yardeni Research.
With the day’s moves, the S&P 500 is now off more than 2% in November after notching gains for six straight months, with the index off by more than 3% from its recent all-time high, while the tech-heavy Nasdaq is worse off, down more than 5% from its record. The technology sector within the S&P 500 is off by 5% this month and has fallen nearly 7% from its high.
Artificial intelligence could be increasing worker productivity so much that companies slow hiring, top Trump administration economic advisor Kevin Hassett said Monday. The National Economic Council director told CNBC that there could be almost quiet time in the labor market because firms are finding that AI is making their workers so productive that they don’t necessarily have to hire new kids out of college. He maintained, however, that any AI-induced softness would be temporary.
The commentary from Hassett creates perverse situation where artificial intelligence simultaneously drives stock market gains while destroying employment opportunities, raising questions about whether productivity improvements benefit shareholders at the expense of workers. Critics argue that if AI eliminates jobs rather than creating them, the technology may prove less transformative than bulls suggest.
Federal Reserve Governor Christopher Waller on Monday backed a quarter percentage point rate cut in December as a way to stave off weakness in the labor market, stating that economic evidence is mounting that hiring is slowing while inflation is largely contained and tariff-induced price increases are likely temporary. However, Waller’s dovish comments failed to lift investor sentiment as traders focused on growing uncertainty about whether delayed economic data will provide sufficient evidence to justify another cut.
Bitcoin plunged alongside equities, trading around $91,000 and briefly touching $89,259, its lowest since April 22. With Tuesday’s losses, Bitcoin is now down 2% for the year, demonstrating that the cryptocurrency continues behaving as high-beta technology proxy rather than safe-haven alternative to traditional assets. The digital asset’s collapse vindicates skeptics who warned that Bitcoin had failed to achieve its aspiration as digital gold.
Investors are also reckoning with the decreasing probability of an interest rate cut at the Fed’s meeting next month, with the prospect of an interest-rate cut typically boosting the stock market since the promise of cheaper borrowing means a potential boon for firms and their investors. However, the opposite also holds true as hope of a rate cut fades, causing stocks to turn lower.
Previously the CME Fed watch tool saw 90% chance of rate-cut, now it’s down to 40%, representing a dramatic shift in expectations over just one month. The collapse in December rate cut probabilities reflects growing recognition that inflation remains stubbornly elevated despite Federal Reserve officials’ optimistic projections, creating headwinds for equity valuations that depend on continued monetary accommodation.
The question facing investors is whether Nvidia’s Wednesday earnings will provide catalyst for technology stock recovery or trigger additional selling if results disappoint elevated expectations. Market gains this year have been concentrated in a handful of tech giants known as the magnificent seven: Alphabet, Amazon, Apple, Meta, Microsoft, Tesla and Nvidia, with worries over artificial intelligence having thrown cold water on the stocks in recent days.
With increased uncertainty comes increased volatility, and that’s exactly what we’ve seen so far in November, said Bret Kenwell, an investing analyst at eToro, citing interest rate expectations as well as potential Supreme Court ruling that could eliminate large portions of Trump’s tariff policy. The convergence of multiple sources of uncertainty creates treacherous environment where investors lack visibility about key drivers of market performance.
The delayed September jobs report will be released Thursday at 8:30 a.m., with a day later the BLS releasing real earnings, a companion report to the monthly consumer price index that did not come out simultaneously in October. The wave of delayed economic data could provide clarity about conditions during the government shutdown or reveal deterioration that markets have not yet priced in.
Despite acknowledging the recent strain, analysts signaled confidence about the path forward, with Ivan Feinseth, a market analyst at Tigress Financial, saying the S&P 500 would finish the calendar year with an uptick from its current level of about 6,700 to 7,000. Feinseth attributed his optimism to expectations of continued AI adoption as well as resilient economic performance.
However, conservative strategists note that reaching 7,000 by year-end would require a 5% rally from current levels during a period characterized by deteriorating technical conditions, mounting valuation concerns, and uncertain Federal Reserve policy. The bullish forecast appears increasingly disconnected from market realities as the four-day losing streak demonstrates that selling pressure is accelerating rather than abating.
As markets prepare for Nvidia earnings Wednesday and delayed September jobs data Thursday, the convergence of key fundamental releases with ongoing uncertainty about Federal Reserve policy creates potential for either powerful recovery if results exceed expectations or accelerated decline extending the four-day losing streak into full-blown correction. The S&P 500’s breach of the 50-day moving average represents significant technical deterioration that historically precedes additional weakness, suggesting that dip-buyers who emerged during previous selloffs may remain sidelined until clearer signals about market direction emerge from upcoming data releases.
