Stocks Decline Amid AI Fears and Geopolitical Risks

Chipmakers and AI-infrastructure stocks under pressure, dragging broader market lower

Published on Feb. 26, 2026

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U.S. stock indexes closed lower on Thursday, led by losses in chipmakers and AI-infrastructure stocks, amid renewed caution over the outlook for artificial intelligence. Geopolitical risks, including tensions with Iran, also weighed on the market. Economic data was mixed, with stronger-than-expected jobless claims and Philadelphia business outlook offset by a wider trade deficit and drop in pending home sales.

Why it matters

The decline in stocks, particularly in the technology and AI sectors, reflects ongoing concerns about the potential disruption and economic impact of advancements in artificial intelligence. Geopolitical tensions also continue to create market volatility and uncertainty. These factors could have broader implications for investor sentiment and the overall performance of the U.S. equity market.

The details

The S&P 500 Index closed down 0.28%, the Dow Jones Industrial Average fell 0.54%, and the Nasdaq 100 Index declined 0.41%. Chipmakers and AI-related stocks were among the biggest losers, with Western Digital, Seagate Technology, Microchip Technology, and others closing down more than 2%. The decline was also driven by negative carryover from the previous day's hawkish Federal Reserve minutes and a jump in oil prices, which lifted inflation expectations.

  • On Thursday, U.S. stock indexes closed lower.
  • The March E-mini S&P futures fell 0.25%, and March E-mini Nasdaq futures fell 0.40%.

The players

S&P 500 Index

A stock market index that tracks the performance of 500 large-cap U.S. companies.

Dow Jones Industrial Average

A stock market index that tracks 30 large-cap U.S. companies.

Nasdaq 100 Index

A stock market index that tracks 100 of the largest non-financial companies listed on the Nasdaq stock exchange.

Western Digital

A leading manufacturer of data storage devices and solutions.

Seagate Technology Holdings

A major provider of data storage technology and solutions.

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What they’re saying

“President Trump said Thursday that 'really bad things will happen' if there is no deal with Iran.”

— President Trump (barchart.com)

What’s next

The market's focus will be on corporate earnings results and economic data releases on Friday, including Q4 GDP, personal spending and income, and the S&P manufacturing PMI.

The takeaway

The decline in stocks, particularly in the technology and AI sectors, highlights ongoing concerns about the potential disruption and economic impact of advancements in artificial intelligence, as well as the continued influence of geopolitical tensions on the broader market.