Why is Dow Jones down today: Dow crashes more than 270 points today – S&P 500 and Nasdaq also in deep red
Why is Dow Jones down today: The Dow Jones Industrial Average fell 271.87 points to 49,390.79, down 0.55% in Thursday trading, as investors reacted to Walmart earnings, rising oil prices, and escalating US–Iran tensions. The S&P 500 Index dropped 25.42 points to 6,855.89, a 0.37% decline. The Nasdaq Composite slid 76.03 points to 22,677.60, down 0.33%.
Markets gave back part of Wednesday’s rally as traders reassessed risk. Crude oil prices jumped more than 2%. Asset management stocks sold off sharply. Software shares remained under pressure amid growing fears about artificial intelligence disruption.
The market reaction came despite strong quarterly results from Walmart, which beat Wall Street expectations in the fourth quarter. However, the company’s full-year earnings outlook disappointed investors.
Software-as-a-Service (SaaS) stocks are facing a new identity crisis. Leaders like Salesforce, Intuit, and Cadence Design Systems saw significant declines following warnings from industry leaders that generative AI could replace up to 50% of enterprise software tasks.
At the same time, geopolitical uncertainty intensified after President Donald Trump said he would decide within 10 days whether to launch military strikes against Iran over its nuclear program. Oil surged. Risk appetite cooled.
Despite the red on the screens for major indices, a significant breakout occurred in the global shipping sector. The SonicShares Global Shipping ETF (BOAT) reached an all-time high as freight rates climbed due to capacity constraints and regulatory changes. Companies like Pan Ocean and HMM saw gains of 8% and 5%, respectively. This highlights a “change in leadership” where money is moving away from the “Magnificent Seven” tech giants and into the physical backbone of the economy.
Wall Street is now navigating earnings season, geopolitical risk, sector rotation, and AI disruption — all at once.
Why is the Dow Jones down today?
The main drivers behind today’s stock market decline are clear: geopolitical tension, rising crude oil prices, weak forward guidance from Walmart, and a sharp selloff in asset manager stocks.
Crude oil prices climbed sharply. WTI crude oil rose to $66.57, up 2.34%. Brent crude oil increased to $70.72, up 2.18%. Higher oil prices raise concerns about inflation and input costs. That directly impacts corporate profit expectations.
Geopolitical risk escalated after President Trump stated he is evaluating possible military strikes against Iran. Markets dislike uncertainty. Energy stocks gained. But broader equities turned cautious.
Gold futures edged up $9.40 to $5,018.90 per ounce — holding above the psychologically critical $5,000 level amid geopolitical uncertainty. Silver added $0.28 to $77.88. Bitcoin was essentially flat, trading at $66,518, up just $76 on the day. Ether fell 1.40% to $1,926.27.
Investors also rotated out of risk-sensitive financial and alternative asset managers after liquidity tightening news from Blue Owl Capital.
Walmart earnings beat estimates but guidance disappoints
Walmart stock initially gained after the company reported stronger-than-expected fourth-quarter results. Annual revenue reached $713.5 billion for the fiscal year ended January 31.
E-commerce grew 24% year over year in the fourth quarter. Advertising revenue increased 37%. Walmart Connect, its ad platform, rose 33%.
However, full-year earnings guidance came in below analyst forecasts. That tempered enthusiasm. Investors are increasingly focused on forward outlooks, not past performance.
The retail giant continues to gain market share, especially among higher-income consumers. But margin pressures remain a concern in a volatile macro environment.
Amazon becomes world’s largest company by revenue
In a major milestone, Amazon surpassed Walmart in total annual revenue.
Amazon reported $716.9 billion in net sales for 2025, slightly ahead of Walmart’s $713.5 billion. The growth reflects strength not only in retail but also in cloud computing and technology services.
Amazon Web Services remains a key driver of top-line growth. The comparison underscores how diversified revenue streams are reshaping the global retail and technology landscape.
For investors, the shift highlights the ongoing dominance of tech-enabled platforms in global commerce.
Asset manager stocks tumble after Blue Owl liquidity move
The sharpest losses came from alternative asset managers after Blue Owl Capital announced it would tighten investor liquidity following the sale of $1.4 billion in loan assets.
- Blue Owl shares fell more than 9%.
- Blackstone declined 6%.
- Apollo Global Management dropped 5%.
The move triggered concerns about liquidity across private credit markets. Investors are highly sensitive to any signs of stress in alternative investments, especially after rapid growth in private lending.
The selloff weighed on financials and contributed significantly to the Dow’s decline.
- Software stocks fall as AI disruption fears grow
- Software stocks continued to face pressure.
- Salesforce fell more than 1%.
- Intuit declined 2%.
- Cadence Design Systems dropped 3%.
Concerns intensified after Mistral AI CEO Arthur Mensch stated that over 50% of enterprise software could be replaced by artificial intelligence tools.
That comment added to existing worries that generative AI could compress margins and disrupt traditional subscription software models.
The Nasdaq remains sensitive to shifts in AI sentiment. Even small comments can trigger rotation out of high-multiple growth stocks.
Oil prices surge as US–Iran tensions rise
Energy markets reacted immediately to geopolitical headlines.
WTI crude oil gained $1.52 to $66.57. Brent crude added $1.51 to $70.72.
Traders fear supply disruptions if military action escalates in the Middle East. Even the possibility of conflict can lift oil futures.
Higher oil prices can fuel inflation expectations. That complicates Federal Reserve policy outlooks. It also pressures transportation, airlines, and industrial companies.
Energy stocks showed relative strength. But broader market sentiment turned cautious.
Sector rotation signals a shift in market leadership
Market strategists say Thursday’s decline reflects a broader rotation.
Antonio Rodrigues, chief investment officer at Procyon, described the move as confirmation of changing leadership within the S&P 500. He noted that earnings momentum must broaden beyond the largest 10 companies.
Industrials and consumer cyclicals could benefit from infrastructure investment and AI-driven efficiency gains. Grid-related companies continue to attract long-term interest as energy demand rises.
Meanwhile, mega-cap technology stocks, including members of the “Magnificent Seven,” showed mixed performance after leading Wednesday’s rally.
Where Smart Money Is Moving: Industrials, Energy Grid, and Shipping
Rodrigues flagged industrials and consumer cyclicals as two sectors positioned to benefit from AI-related efficiency gains — even as software names suffer from AI disruption fears. “Everything related to the grid still has legs,” he said. “There’s still lots of things being built. Those are multiyear, even perhaps multidecade, themes.”
Global shipping stocks validated that view Thursday with an emphatic rally. Pan Ocean surged 8%. HMM rose 5%. Mitsui O.S.K. Lines gained more than 2%. Okeanis Eco Tankers and Hafnia each added 3%. The SonicShares Global Shipping ETF (ticker: BOAT) hit a new intraday all-time high and is now up 60% since its 2021 launch — a remarkable run driven by regulation shifts, tighter capacity, and elevated freight costs reshaping the industry’s economics.
Wall Street is closely monitoring three key variables:
First, developments in US–Iran tensions. Any confirmation of military action could push oil higher and pressure equities further.
Second, corporate earnings guidance. Investors want clarity on 2025 growth projections.
Third, liquidity conditions in private credit and alternative assets following Blue Owl’s move.
Bitcoin traded near $66,518, up 0.11%, showing relative stability. Gold rose to $5,018.90, up 0.19%, indicating modest safe-haven demand.