Wall Street ends lower as tech stocks drag S&P 500, Nasdaq

US stocks closed slightly lower on Wednesday as a fall in technology shares, particularly chipmakers, weighed on the S&P 500 and Nasdaq, while gains in Meta Platforms helped limit broader losses.

The Dow Jones Industrial Average slipped 13.96 points, or 0.03%, to 52,305.24. The S&P 500 fell 16.13 points, or 0.22%, to 7,483.23, while the Nasdaq Composite declined 173.69 points, or 0.66%, to 26,040.03.

Semiconductor stocks were among the main drags on the market, with the Philadelphia semiconductor index closing 6.3% lower. The technology sector led declines among S&P 500 sectors, as investors continued to assess high valuations and heavy artificial intelligence-related spending by major technology companies.

Meta Platforms rose 8.8% after Bloomberg News reported that the company is developing a cloud business to sell excess AI computing capacity.

Investors also weighed comments from Federal Reserve Chair Kevin Warsh, who said recent inflation risks had eased but maintained that the US central bank would remain committed to its 2% inflation target. He said he would disappoint anyone expecting loose monetary policy despite President Donald Trump’s call for interest rate cuts.

Traders slightly reduced their expectations for rate hikes after Warsh’s remarks, though markets still expect at least one hike from the Federal Reserve this year, according to LSEG data.

The market also remained cautious ahead of Thursday’s US jobs report. Trading will be closed on Friday for the Fourth of July holiday.

Geopolitical concerns also stayed in focus after Iran and the United States concluded another round of indirect talks on Wednesday without signs of progress towards a lasting peace. The two countries had signed an interim accord last month.

Investors also reviewed data from the Institute for Supply Management, which showed US manufacturing activity slowed in June but remained solid.

Among other movers, Alcoa shares fell 8.9% after Australia’s South32 agreed to sell most of its aluminium assets to Alcoa.

Wednesday’s decline followed a strong second quarter for US equities. The S&P 500 and Nasdaq posted their biggest quarterly gains since 2020, while the Dow recorded its best quarterly performance since 2022.

Trading volume on US exchanges stood at 19.71 billion shares, below the 20-session average of 23.36 billion shares.

On the New York Stock Exchange, advancing stocks outnumbered decliners by a 1.07-to-1 ratio, with 353 new highs and 127 new lows. On the Nasdaq, 2,661 stocks advanced and 2,303 declined, with gainers outnumbering losers by a 1.16-to-1 ratio.