US stock market: Wall Street extends slide for third day as tech selling continues; Alphabet drops 8%

US stocks extended their losing streak to a third consecutive session on Thursday, February 5, as continued selling in software and technology shares weighed on key indices and limited any rebound. Adding to the pressure, recent private jobs data rekindled concerns over an economic slowdown.

Following a 1.77% decline in the previous session, the tech-heavy Nasdaq Composite slipped another 1.4% to the day’s low of 24,549, as selling in technology further intensified. The broader S&P 500 also opened lower, trading with a loss of 0.53%, while the Dow Jones Industrial Average was down 0.40%.

The pressure extended beyond equities, with precious metals and Bitcoin also seeing sharp corrections, pointing to broader risk-off sentiment.

Among individual stocks, Google parent Alphabet fell 8% to $307 per share following the release of its December quarter numbers. Even as the tech giant reported results that exceeded market expectations, its announcement of a sharp increase in artificial intelligence spending appeared to have impacted investor sentiment.

The company is looking to increase its 2026 capital expenditure to between $175 billion and $185 billion—more than double its 2025 spend.

Amazon results are also due after US markets close, with investors expected to put its AI spending under the microscope as well.

Among other top laggards was chipmaker Qualcomm, which has also come under pressure, with stock opening with a gap down of 11% after the company said an industry-wide shortage of memory would cut into its second-quarter results.

Outside of tech, Estee Lauder shares opened lower at $104.75 per share, down 12.4% from the previous close. Even though the company reported better-than-expected numbers for Q4, it said it expects tariff-related headwinds to wipe out about $100 worth of profits in 2026.

Software and tech stocks have led recent declines, as fears of AI-driven disruption have prompted investors to rotate out of technology stocks and into more attractively valued segments of the market.

On the macro front, private sector employment in the US rose less than expected in January, while layoffs during the month were the highest to start a year since 2009, as per media reports.

Bitcoin sinks nearly 5%

In the crypto market, Bitcoin tumbled nearly 5%, slipping from below $70,000 to $69,295. This marks its lowest level since November 2024 and represents a decline of more than 40% from its all-time high of around $125,000 hit in October.

Cryptocurrencies such as Bitcoin came under pressure after US Treasury Secretary Scott Bessent said, in response to questions at the House Financial Services Committee on Wednesday, that he does not have the authority to order banks to buy such assets.

Tech sell-off narrows valuation gap, but risks persist, says expert

Viram Shah, founder and CEO of Vested Finance, said that the US tech stocks are under pressure mainly because valuations had run far ahead of fundamentals, and any negative trigger, such as softer guidance, higher rates, or uncertainty around AI monetization, is leading to sharp corrections.

The Nasdaq has fallen around 5% from recent highs, and several large tech names are down 15–25%, even without a major change in their long-term business outlook. This does not automatically mean the bottom is in, but it does mean parts of the tech market are now closer to fair value.

For long-term investors, he advised to stay selective and staggered buying in strong, cash-generating companies can start to make sense, rather than trying to time an exact bottom.

(With inputs from Bloomberg, AP)

Disclaimer: We advise investors to check with certified experts before making any investment decisions.