US stocks open mixed as investors rotate away from tech and weigh softer hiring signals

US markets started the session on a split note on Wednesday, February 4, 2026, as traders kept pulling money out of big technology names and looked closely at new hints that the labor market is cooling. In midday trading, the S&P 500 was slightly higher, the Dow Jones Industrial Average rose around 0.4%, and the Nasdaq Composite dipped about 0.2%.

This kind of “mixed open” often signals a market that’s unsure. Some investors are still comfortable owning steadier, value-leaning companies. Others are trimming positions in high-growth tech stocks that can swing more when interest-rate expectations, earnings outlooks, or competition fears change.

Market snapshot: what moved and why it mattered

By midday, the S&P 500 was up about 0.1%, the Dow added roughly 173 points (about 0.4%), and the Nasdaq slipped around 0.2%.

That split reflects a simple story: many non-tech stocks were holding up, but weakness in major growth and technology shares was still heavy enough to drag the Nasdaq lower.

Why the Dow looked stronger than the Nasdaq

The Dow includes many large, established companies that investors often view as more “stable” during uncertain stretches. The Nasdaq, meanwhile, is packed with technology and growth firms—exactly the group investors were rotating away from.

Tech sector stays under pressure: chips and software lead the slide

The biggest reason for the uneven market was continued selling in technology. Semiconductor and software shares extended losses, keeping the Nasdaq softer than other indexes.

AMD drops after guidance disappoints

One of the day’s headline movers was Advanced Micro Devices (AMD). Shares fell about 9% after the company’s first-quarter forecast came in below what some analysts expected. Traders read the outlook as another sign that certain parts of the chip industry may be facing tougher demand conditions or tighter profit margins than the market previously hoped.

Even when a company reports solid results, guidance can be the deciding factor. Markets are forward-looking. If investors think the next few months could be slower, the stock can drop quickly—especially after a strong run.

Other chipmakers follow lower

The weakness did not stop with AMD. Other chip names, including Broadcom and Micron Technology, traded lower during the session as investors stayed cautious about the semiconductor group.

Software stocks remain shaky amid “AI disruption” worries

Software also stayed under pressure. Stocks such as Salesforce, Oracle, and CrowdStrike extended losses from the prior day. A key worry driving the mood is that new AI automation tools could eventually replace or compress parts of what software and data-focused companies sell today, rather than simply boosting demand for their products.

In other words, the market is asking a hard question: “If AI can do more tasks automatically, which companies become stronger—and which ones get squeezed?” That uncertainty can make investors more selective, especially when stock valuations are high.

What sparked the latest AI anxiety?

According to reports covering the selloff, concern intensified after new AI automation tools from startup Anthropic highlighted how quickly AI can move into tasks often handled by software platforms and professional services. That shift has pushed investors to rethink long-term growth assumptions across tech.

Earnings season becomes the “next clue” for direction

With tech under pressure, investors looked to earnings as the next major guide. Two of the biggest upcoming reports mentioned by market watchers were:

• Alphabet, scheduled to report after Wednesday’s market close

• Amazon, expected to report on Thursday

These companies carry enormous weight in major indexes. If results or guidance surprise—positively or negatively—markets can swing fast.

Why “Magnificent Seven” earnings matter so much

In recent years, a small group of mega-cap tech firms has contributed a large share of index returns. When investors worry about tech, they often start by trimming these giants because they are heavily owned and can be sold quickly. Earnings help answer whether those companies can keep growing fast enough to justify their large valuations.

ADP jobs report: a softer signal from the labor market

Outside of earnings, economic data also shaped sentiment. The ADP private payrolls report showed employers added only 22,000 jobs in January. That was below the 45,000 increase expected by economists surveyed by Dow Jones, and it was also lower than December’s revised gain of 37,000.

When hiring slows, investors start debating what it means for consumer spending, corporate profits, and Federal Reserve policy. Slower hiring can point to weaker economic momentum—but it can also reduce inflation pressure, which sometimes helps stocks. The market often reacts to which story feels stronger that day.

“Low-hire, low-fire”: what economists mean

Economists described the environment as “low-hire, low-fire.” That phrase means companies may be hesitant to hire aggressively, but they are also not rushing to lay off large numbers of workers. This kind of cautious stability can happen when businesses feel uncertain about the outlook but don’t see a reason to panic.

Where the jobs were—and weren’t

The ADP details showed job gains were concentrated in a narrow set of areas:

• Education and health services added about 74,000 jobs, making up most of the total gain.

• Construction added about 9,000.

• Other categories such as financial activities, leisure and hospitality, and trade/transportation/utilities saw modest increases.

Meanwhile, some categories declined:

• Professional and business services fell about 57,000.

• Manufacturing fell about 8,000.

• Other services declined about 13,000.

This split suggests strength in service-related areas, with continued softness in more cyclical segments that can slow earlier when growth cools.

Company size also told a story

ADP data indicated that mid-sized firms (50–499 employees) generated the net gains, while small businesses were flat and large employers cut about 18,000 jobs. That pattern can hint at uneven confidence across the business landscape.

Government shutdown aftermath: why some key data wasn’t coming on time

Another unusual wrinkle was the timing of official labor data. The US nonfarm payrolls report from the Bureau of Labor Statistics was not being published that week due to a recent partial government shutdown. The shutdown began on Saturday and ended Tuesday after President Donald Trump signed a funding bill into law.

When official data is delayed, markets lean more heavily on alternative reports (like ADP) and on corporate commentary. That can increase uncertainty and sometimes raise day-to-day volatility.

The bigger rotation: value beats growth as investors rethink tech leadership

Beyond the day’s headlines, this session fit into a broader rotation theme: investors were favoring value over growth. Reuters reported that value stocks outperformed while growth lagged amid the tech and software pullback tied to AI disruption fears.

Rotations like this can last days, weeks, or longer. They often happen when:

• Interest rate expectations shift (growth stocks can be more sensitive to rates).

• Earnings confidence weakens for a leading sector.

• New competition changes the long-term story (like rapid AI advances).

Why AI can both help and hurt tech stocks

AI is not a simple “good news” or “bad news” story. For some companies, AI means new products, faster growth, and better efficiency. For others, AI may reduce demand for existing tools or push prices down if competitors can offer similar outcomes with fewer people and less software. That “winner vs. loser” uncertainty is a big reason the market became more selective.

What this mixed open suggested about investor psychology

A day where the Dow rises while the Nasdaq slips can look confusing—until you break down the mood behind it. This kind of tape often signals:

• Cautious optimism about the broader economy (enough to support industrials and value names).

• Specific concern about tech valuations and near-term guidance.

• Wait-and-see behavior ahead of major earnings (Alphabet, Amazon) and clearer labor data.

In plain terms: investors were not “fleeing” stocks altogether, but they were getting picky about where they wanted to take risk.

Quick reference table: key drivers behind the session

Driver	What happened	Why it mattered
Index split	Dow up ~0.4%, Nasdaq down ~0.2%, S&P 500 up ~0.1%	Shows rotation away from tech and toward steadier sectors
Semiconductors	AMD down ~9% after forecast; Broadcom & Micron lower	Guidance raised fresh worry about demand and margins
Software	Salesforce, Oracle, CrowdStrike extend losses	AI automation fears pressure long-term growth narratives
Labor data	ADP: +22,000 jobs in January (below expectations)	Signals sluggish hiring and raises policy/economy questions
Earnings focus	Alphabet due after close; Amazon due Thursday	Big tech results could reset sentiment quickly

All figures and drivers above are based on the market update and related coverage from the day.

What investors watched next (and what it could mean)

1) Mega-cap tech earnings: guidance is the real headline

Traders weren’t just looking at revenue and profit beats. They were focused on forward guidance, AI spending plans, cloud trends, and any hints about demand. In a market nervous about tech leadership, even small changes in tone can trigger big moves.

2) Follow-through in the labor market story

If more indicators echoed ADP’s sluggish number, investors might grow more concerned about growth. But if the slowdown looked mild and inflation stayed contained, some could interpret it as supportive for rate stability. Reuters noted traders were still expecting the Fed to hold off on cuts until around June, underscoring how sensitive markets remain to incoming data.

3) Whether tech selling spreads—or stabilizes

Markets often test investors’ confidence. If tech stabilizes, the Nasdaq can rebound quickly because many large funds still hold these names. But if more companies guide down or AI disruption concerns grow, the rotation into value could continue.

FAQs

1) Why did the Dow rise when the Nasdaq fell?

The Dow is more exposed to established, non-tech companies, while the Nasdaq is more tech-heavy. On February 4, 2026, investors were selling technology shares and rotating toward steadier areas, which lifted the Dow more than the Nasdaq.

2) What caused AMD to drop about 9%?

AMD fell after its first-quarter forecast came in below some analysts’ expectations, raising concerns about demand and margins in parts of the semiconductor market.

3) What did the ADP report show, and why did markets care?

ADP said private employers added only 22,000 jobs in January, below forecasts. Markets care because hiring trends affect consumer spending, corporate profits, and expectations for Federal Reserve policy.

4) What does “low-hire, low-fire” mean?

It means companies aren’t hiring much, but they also aren’t laying people off aggressively. It suggests caution and uncertainty, but not a full-blown panic.

5) Why were software stocks hit by AI news?

Investors worried that new AI automation tools could reduce demand for some existing software products or pressure pricing, which could weaken long-term growth for certain tech and data-focused firms.

6) Which earnings were investors focused on next?

Alphabet was scheduled to report after Wednesday’s close, and Amazon was due on Thursday. These mega-cap reports can strongly influence index direction and tech sentiment.

7) Where can I follow live market charts and updates?

You can track major indexes and real-time moves on large market platforms. For example, TradingView hosts the market update referenced here and provides streaming charts via its markets section.

Conclusion: a cautious market searching for clarity

In the end, the message from the session was clear: US stocks open mixed when investors can’t fully agree on the next big trend. On February 4, 2026, the market leaned into a defensive rotation—away from tech and toward steadier names—while traders weighed a soft ADP hiring print, shutdown-related data delays, and high-stakes earnings from mega-cap leaders.

If upcoming earnings and economic reports restore confidence in tech growth, the Nasdaq could regain momentum quickly. But if guidance remains cautious and AI disruption fears keep building, investors may continue favoring value and stability—at least until the next clear signal arrives.

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