Short sellers reap over $5 billion on Big Tech bets as AI fears roil market

📊 Stock market today: Dow, S&P 500, Nasdaq stumble in wait for Walmart earnings, Jackson Hole kickoff:

The Dow led US stocks lower before the bell on Thursday, with Walmart (WMT) earnings in focus before the start of the Federal Reserve's closely watched gathering at Jackson Hole.

Dow Jones Industrial Average futures (YM=F) pulled back 0.3%, while those on the S&P 500 (ES=F) moved down roughly 0.2%. Contracts on the tech-heavy Nasdaq 100 (NQ=F) nudged 0.1% lower, as the exodus from tech stocks eased.

Walmart (WMT) earnings in premarket will cap a week of results from retail giants, and investors have high expectations. Earlier this week, Home Depot (HD) and Target (TGT) reported results. Yahoo Finance reports.


💻 The tech trade hits pause ahead of Nvidia earnings:

The tech pullback this week wasn't anywhere close to a Deepseek moment, when investors questioned the long-term viability of Silicon Valley's AI transition after the Chinese company competed favorably with OpenAI at a fraction of the cost.

But Wall Street did hit the brakes, alarmed by a handful of pessimistic headlines amplifying long-standing criticism about ballooning valuations and the costs of the AI boom.

While it's too premature and extreme to forecast a major failure or correction — AI stocks have kept plenty enough gains to keep the S&P 500 in the 6,300s — it's clear that the market is signaling a measure of unease with current measures of success. Yahoo Finance reports.


🏦 Treasury yields inch higher as investors look ahead to Fed Chair Powell’s speech:

U.S. Treasury yields inched higher as investors look ahead to Federal Reserve Chairman Jerome Powell’s speech at the Fed’s annual economic symposium on Friday.

At 7 a.m. ET, the 10-year Treasury yield rose over 1 basis point to 4.308%. The 2-year yield was also one basis point higher at 3.76%.

One basis point is equal to 0.01% and yields and prices move in opposite directions. Investors are keeping an eye on the Fed’s annual meeting in Jackson Hole, Wyoming, where central bankers are gathered to make decisions on future monetary policy.

Powell is set to give a speech on Friday at the meeting, which could offer some insights into the path of interest rates. CNBC reports.


💊 J&J to invest $2 billion to boost US manufacturing as drug tariffs loom:

Johnson & Johnson said on Thursday it would invest $2 billion in North Carolina as it aims to expand its U.S. manufacturing presence amid looming drug import duties proposed by President Donald Trump's administration.

Major drugmakers, including Eli Lilly and AstraZeneca, have also committed to shell out billions of dollars to scale up their U.S. footprint in response to Trump's efforts, including tariff threats.

Earlier this month, Trump said he plans to impose phased-in tariffs for the pharmaceutical sector, which could start small and eventually rise to 250%. MarketScreener reports.


💉 Riding high on Wegovy, Novo doubled its workforce. Now layoffs loom:

As Novo Nordisk's sales of its blockbuster weight-loss drug Wegovy boomed, the Danish drugmaker raced to expand manufacturing capacity and sales outreach with a hiring spree that almost doubled staff numbers over five years.

Now sales are slowing and layoffs loom. Annual reports show that Novo's workforce grew from around 43,260 employees in 2019 to 77,350 by the end of last year - an average of 131 new roles filled each week, far faster than rival Eli Lilly (LLY.N), whose headcount rose from 36,000 to 47,000 over the same period. Reuters reports.


🛒 Walmart hikes sales and earnings outlook even as it says tariff costs are rising:

Walmart on Thursday raised its full-year earnings and sales outlook as its online business posted another quarter of double-digit gains, even as the company said costs are rising from higher tariffs.

The big-box retailer topped Wall Street’s quarterly sales estimates. But the company said it felt pressure on profits for the period, including from some one-time expenses, such as restructuring costs, pricier insurance claims and litigation settlements.

Walmart said it now expects net sales to grow between 3.75% to 4.75% for the fiscal year, up from its previous expectations for 3% to 4%. It raised its adjusted earnings per share outlook slightly to $2.52 to $2.62, up from a prior range of $2.50 to $2.60 per share. CNBC reports.

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