Closing Bell Overtime: AI Hits a Speed Bump 9/14/26

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Melissa Lee (0:30)

The board recommends approving.

SPEAKER_3 (0:31)

Regarding that seat on the committee, we're promoting.

SPEAKER_1 (0:33)

To boost quarterly earnings.

SPEAKER_4 (0:34)

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Melissa Lee (1:00)

The bells bring in to the training day at the NYMC. Teva Pharmaceutical, ringing the closing bell. Not the NASDAQ, Norwood Financial doing the honors. Welcome to Closing Bell Overtime. We're live from Studio B at the NASDAQ market site. I'm Melissa Lee along with Mike Santoli. Stocks slightly lower today as the market tries to process the impact of a slower AI build out. The Dow down a little more than 150 points. S&P 500 NASDAQ composite both down about a half a percent. Slightly bigger loss from the NASDAQ 100

Michael Santoli (1:25)

Of the Big Mag 7 hyperscalers, Google, Microsoft and Meta all gaining today as slowing spending might not be bad for them, but it would hurt NVIDIA which lost about 3%.

Other chip and memory names including Broadcom, Micron and SanDisk also falling pretty significantly. The component parts of the AI build down, optical gear also getting crushed, Corning down 13%, almost 14%. Even the industrial stocks hit hard, Eaton and GE Vernova losing about 8% each.

Melissa Lee (1:54)

But the money is going somewhere. Software stocks are the big beneficiaries today, especially the cyber security names, CrowdStrike, Palo Alto and Okta all up big. And we're even seeing a safety rotation with consumer staples, one of the best performing sectors today. Our team is all over every aspect of this. Kate Rooney on Anthropic and OpenAI, Leslie Picker on the IPO implications and Megan Cassell is watching What is Coming Out of Washington. We'll get to them in just a moment, but we do want to get the first take on the close here. Mike, if we had said 5%, you know, fruit oil much higher, AI, question mark, I don't know if you'd say the markets would be sort of flat.

Michael Santoli (2:29)

Probably not, although interesting that the buyers showed up in treasuries just as we clicked over 5%.

You know, we needed to test it. Oil is like $4 off the intraday high, so maybe a little relief there, but you know, again, another one of these days where the index looked like it was hanging in there well, 10% of the S&P 500 was down at least 4%, 10% was up at least 4%, and so we keep having this push-pull inside the market. We know it's a broken record, but that's exactly what's been going on, so it's prevented the market. Fear in one part of the market gets converted into relief in another segment, and how sustainable is it? What do we need to see once the bond market reacts to the Fed on Wednesday and all the rest? Big questions. I did find it interesting, though, that the money did flow back into MAG-7 type names that seem like, okay, fine, maybe if we kind of pace things out on the AI spend, they just have their great businesses to fall back on.

Melissa Lee (3:23)

Right. And then also, we highlighted so many sectors that were sort of losers on this and winners off of this, but one that we didn't mention is biotech, which had been losing effectively to the sort of high growth AI trade, but without it, people are looking for that return and they're going to biotech once again. So we saw a bid there in that sector.

Michael Santoli (3:40)

Absolutely. Even some of the stocks that were very much in the AI will kill this business bucket, the Fairfax set and Gartner Group. Now obviously that could just be positioning. It could just be a positioning shock and a shakeout and a short covering rally, but it is still interesting that we're not just saying game over, we're backing away from the market at least.