The S&P 500 Index ($SPX) (SPY) on Thursday closed down -1.23%, the Dow Jones Industrials Index ($DOWI) (DIA) closed down -1.20%, and the Nasdaq 100 Index ($IUXX) (QQQ) closed down -1.38%.  March E-mini S&P futures (ESH26) fell -1.23%, and March E-mini Nasdaq futures (NQH26) fell -1.40%.

Stock indexes extended this week's sell-off on Thursday, with the S&P 500 falling to a 1.5-month low and the Nasdaq 100 dropping to a 2.5-month low.  The sell-off in technology stocks persists, with Qualcomm falling more than -8% to lead chip stocks lower after it forecasted weaker-than-expected Q2 revenue. Also, cybersecurity stocks sold off on Thursday, led by a 9% decline in CrowdStrike Holdings. 

Losses in stocks accelerated on Thursday by signs of weakness in the US labor market after Challenger's January job cuts rose +117.8% y/y to 108,435, the largest amount of job cuts for a January since 2009.  Also, weekly initial unemployment claims rose by +22,000 to an 8-week high of 231,000, showing a weaker labor market than expectations of 212,000.  In addition, the US Dec JOLTS job openings unexpectedly fell by -386,000 to a 5.25-year low of 6.542 million, versus expectations of an increase to 7.250 million. 

Fed Governor Lisa Cook said she supported last week's Fed decision to hold interest rates steady because she now sees "risks as tilted toward higher inflation." She added that, "After nearly five years of above-target inflation, it is essential that we maintain our credibility by returning to a disinflationary path and achieving our target in the relatively near future."

Bitcoin (^BTCUSD) plunged more than -12% on Thursday to a 1.25-year low as negative momentum deepened across cryptocurrencies.  Bitcoin is down nearly 50% from its October record high, and inflows into US spot Bitcoin ETFs have reversed, with about $2 billion coming out of Bitcoin ETFs over the past month and more than $5 billion pulled out over the past three months, data compiled by Bloomberg show. 

The markets this week will focus on earnings and economic news. On Friday, the University of Michigan's Jan consumer sentiment index is expected to fall by -1.4 points to 55.0. 

Q4 earnings season is in full swing, with 150 of the S&P 500 companies scheduled to report earnings this week.  Earnings have been a positive factor for stocks, with 79% of the 275 S&P 500 companies that have reported beating expectations.  According to Bloomberg Intelligence, S&P earnings growth is expected to climb by +8.4% in Q4, marking the tenth consecutive quarter of year-over-year growth.  Excluding the Magnificent Seven megacap technology stocks, Q4 earnings are expected to increase by +4.6%.

The markets are discounting a 25% chance for a -25 bp rate cut at the next policy meeting on March 17-18.

Overseas stock markets settled lower on Thursday.  The Euro Stoxx 50 closed down by -0.75%.  China's Shanghai Composite closed down -0.64%.  Japan's Nikkei Stock 225 closed down -0.88%.

Interest Rates

March 10-year T-notes (ZNH6) on Thursday closed up by +16.5 ticks.  The 10-year T-note yield fell -6.4 bp to 4.210%.   Mar T-notes rallied to a 2.5-week high on Thursday, and the 10-year T-note yield fell to a 2.5-week low of 4.196%.  Thursday's stock market slump boosted demand for safe-haven government debt.  Gains in T-notes accelerated on Thursday on signs of weakness in the US labor market after Challenger job cuts soared, weekly initial unemployment claims rose more than expected to an 8-week high, and Dec JOLTS job openings unexpectedly fell to a 5.25-year low.  In addition, falling inflation expectations are supportive of T-notes as the 10-year breakeven inflation rate fell to a 1.5-week low of 2.311% on Thursday. 

European government bond yields were mixed on Thursday.  The 10-year German bund yield fell -1.7 bp to 2.843%.  The 10-year UK gilt yield rose to a 2.5-month high of 4.597% and finished up by +1.2 bp to 4.559%.

Eurozone Dec retail sales fell -0.8% m/m, weaker than expectations of -0.4% m/m and the biggest decline in 2.25 years.

German Dec factory orders unexpectedly rose +7.8% m/m, stronger than expectations of -2.2% m/m decline and the largest increase in two years.

As expected, the ECB kept the deposit facility rate unchanged at 2.00% and said, "The economy remains resilient in a challenging global environment.  At the same time, the outlook is still uncertain, owing particularly to ongoing global trade policy uncertainty and geopolitical tensions."

As expected, the BOE held its policy rate steady at 3.75% in a 5-4 vote.  BOE Governor Bailey said upside risks to inflation have diminished, and there should be scope for further policy easing if the economy and the inflation outlook evolve as expected.

Political turmoil in England is weighing on the British pound and pushing Gilt yields higher on concern that Prime Minister Starmer's job may be at risk after he appointed Peter Mandelson as ambassador to the US. Mandelson has been linked to the disgraced financier Jeffrey Epstein, which is eroding confidence in Starmer's ability to govern. 

Swaps are discounting a 3% chance of a -25 bp rate cut by the ECB at its next policy meeting on March 19.

US Stock Movers

Qualcomm (QCOM) closed down more than -8% to lead losers in the Nasdaq 100 and chip stocks after forecasting Q2 revenue of $10.2 billion to $11.0 billion, weaker than the consensus of $11.18  billion. Also, Advanced Micro Devices (AMD) and Western Digital (WDC) closed down more than -3%.  In addition, NXP Semiconductors NV (NXPI) closed down more than -2%. 

The Magnificent Seven technology stocks retreated on Thursday, weighing on the overall market.  Amazon.com (AMZN) and Microsoft (MSFT) closed down more than -4%.  Also, Tesla (TSLA) closed down more than -2%, and Nvidia (NVDA) closed down more than -1%.  In addition,  Alphabet (GOOGL) closed down -0.54%, Apple (AAPL) closed down -0.21%, while Meta Platforms (META) bucked the trend and closed up +0.17%.

Cryptocurrency-exposed stocks fell sharply on Thursday as Bitcoin (^BTCUSD) plunged more than -12% to a 1.25-year low.  MARA Holdings (MARA) closed down more than -18%, and Strategy (MSTR) closed down more than 17% to lead losers in the Nasdaq 100.  Also, Galaxy Digital Holdings (GLXY) closed down by more than -16%, Riot Platforms (RIOT) closed down by more than -14%, and Coinbase Global (COIN) closed down by more than -13%. 

Cybersecurity stocks sold off on Thursday.  Crowdstrike Holdings (CRWD) closed down more than -9%, and Zscaler (ZS) closed down more than -8%.  Also, Datadog (DDOG) and Palo Alto Networks (PANW) closed down more than -7%, and Atlassian (TEAM) closed down more than -6%.  In addition, Fortinet (FTNT) closed down more than -2%. 

Fluence Energy (FLNC) closed down more than -34% after reporting Q1 adjusted Ebitda loss of -$52.1 million, wider than the consensus of -$27.1 million. 

Estee Lauder (EL) closed down more than -19% to lead losers in the S&P 500 after forecasting full-year adjusted EPS of $2.05 to $2.25, the midpoint below the consensus of $2.17. 

Ares Management (ARES) closed down more than -11% after reporting Q4 adjusted EPS of $1.45, weaker than the consensus of $1.68.

Cummins Inc (CMI) closed down more than -10% after reporting Q4 EPS of $4.27, well below the consensus of $5.07.

IQVIA Holdings (IQV) closed down more than -10% after forecasting 2026 adjusted EPS of $12.55 to $12.85, below the consensus of $12.96.

Crown Castle (CCI) closed down more than -8% after forecasting full-year adjusted Ebitda of $2.67 billion to $2.72 billion, weaker than the consensus of $2.85 billion. 

Eli Lilly (LLY) closed down by more than -7% after Him & Hers said it will launch a copy of the Wegovy weight-loss pill for $49 a month. 

McKesson Corp (MCK) closed up more than +16% to lead gainers in the S&P 500 after reporting Q3 adjusted EPS of $9.34, better than the consensus of $9.27, and boosting its full-year adjusted EPS estimate to $38.80 to $39.20 from a prior estimate of $38.35 to $38.85.

Corpay (CPAY) closed up more than +11% after reporting Q4 revenue of $1.25 billion, better than the consensus of $1.23 billion.

Tapestry (TPR) closed up more than +10% after reporting Q2 net sales of $2.50 billion, better than the consensus of $2.32 billion. 

Hershey (HSY) closed up more than +9% after reporting Q4 adjusted EPS of $1,71, above the consensus of $1.40, and forecasting full-year adjusted EPS of $8.20 to $8.52, well above the consensus of $7.07.   

Align Technology (ALGN) closed up more than +8% after reporting Q4 adjusted EPS of $3.29, stronger than the consensus of $2.97. 

ARM Holdings Plc (ARM) closed up more than +5% to lead gainers in the Nasdaq 100 after New Street Research upgraded the stock to buy from neutral.

Bristol-Myers Squibb (BMY) closed up more than +3% after reporting Q4 revenue of $12.50 billion, better than the consensus of $12.27 billion, and forecasting full-year revenue of $46 billion to $47.5 billion, well above the consensus of $44.16 billion. 

Earnings Reports(2/6/2026)

AutoNation Inc (AN), Biogen Inc (BIIB), Carlyle Group Inc/The (CG), Cboe Global Markets Inc (CBOE), Centene Corp (CNC), Freedom Holding Corp/NV (FRHC), MarketAxess Holdings Inc (MKTX), Newell Brands Inc (NWL), nVent Electric PLC (NVT), Philip Morris International In (PM), Roivant Sciences Ltd (ROIV), Ubiquiti Inc (UI), Under Armour Inc (UAA), White Mountains Insurance Group Ltd (WTM).

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