According to Reuters, the evolving narrative surrounding AI has triggered sharp moves in individual stocks and increased uncertainty over which industries could be most affected.
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On 14 February 2026, 02:30 AM IST
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The benchmark S&P 500 has seen relatively modest headline changes recently, but underlying sector swings have been pronounced. Concerns about new AI tools reshaping industries such as insurance, wealth management and transportation contributed to a selloff in software and technology shares in particular, Reuters reported. This is in contrast to last year, when enthusiasm around AI-driven earnings growth supported the broader market’s advance.
At the same time, market leadership seems to be expanding. As the technology sector, a key driver of gains, has come under pressure since the bull market began in late 2022, investors have turned to areas that have previously been lagging. Energy, consumer staples, materials and industrials have posted strong gains so far this year, and small-cap stocks have also outperformed, suggesting a possible shift toward more diversified market participation.
Despite this rotation, technology still carries a significant weight in the major indices, meaning continued weakness in this sector could influence the direction of the overall market. However, broad participation in profits is generally seen as a constructive sign of market resilience.
While corporate earnings will be closely watched in the coming days, Walmart’s results are expected to provide insights into consumer spending trends. The retail giant’s performance is often seen as a bellwether for the health of US households, especially after recent data showed retail sales were unexpectedly flat in December. Additional updates from major retailers such as Home Depot, Lowe’s and Target in the coming weeks will further shape the outlook for consumption.
On the macro front, investors will analyze several key economic releases. Upcoming data, including the advance estimate of fourth-quarter GDP, the Consumer Sentiment Survey and the Personal Consumption Expenditure Price Index, have closely watched inflation measures. Recent data showing stronger-than-expected job growth has reinforced perceptions of labor market stability, adding another layer to the policy outlook.
With a holiday-shortened trading week ahead, market participants are expected to remain cautious as they assess whether the ongoing sector rotation can continue with evolving expectations of artificial intelligence’s broader impact on growth, inflation and corporate profitability.
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