Stock Market Opens Lower Amid AI Concerns as Week Begins

Feb 18, 2026, 2:22 AM

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The US stock market started the shortened trading week on a negative note, with both the Nasdaq Composite and the S&P 500 experiencing declines. The tech-heavy Nasdaq dropped 0.1%, continuing its streak of losses attributed to ongoing fears surrounding artificial intelligence (AI) and its disruptive potential across various industries.

Investors returned from Presidents Day to find the market grappling with renewed concerns about AI's impact on sectors such as wealth management, transportation, and logistics. These fears have contributed to a challenging environment, leading to significant drops in stock prices for tech companies, particularly those reliant on software solutions.

The S&P 500 managed to remain just above the flatline, but it has faced setbacks in recent weeks, losing ground in four of the last five weeks due to AI-related anxieties. The Dow Jones Industrial Average also experienced minimal movement, reflecting broader market uncertainties that have kept investors on edge.

In a notable development, Apple Inc saw its shares rise more than 3% on Tuesday. This uptick was fueled by optimism regarding the company's advancements in wearable devices that incorporate AI capabilities. However, the overall sentiment remained cautious, as investors awaited further earnings reports and economic data that could influence market direction.

The week ahead is particularly significant for the retail sector, with Walmart's quarterly report set to be released on Thursday. This will be the first report since Walmart joined the exclusive trillion-dollar market cap club, and analysts are keenly anticipating its implications for the broader retail landscape.

While some companies are managing to navigate the turbulent waters of market sentiment, the software sector has been hit hard. Many investors have rotated away from software stocks, which have suffered substantial losses this year, toward more stable financial stocks like Citigroup and JPMorgan. These moves indicate a strategic shift as traders look for safer investments amid prevailing uncertainties.

The overall narrative surrounding AI innovation continues to be a double-edged sword, prompting scrutiny of the long-term viability of many companies. Scott Chronert, a Citi US equity strategist, noted that the market is currently focused on specific risks rather than broader exposure changes. He emphasized the importance for companies to establish strong business "moats" to withstand potential disruptions from AI technologies.

As the week progresses, traders will be closely watching economic indicators, including the upcoming personal consumption expenditures price index report, which could provide insights into inflation trends. Additionally, the release of Federal Reserve meeting minutes on Wednesday may further influence market dynamics.

In summary, the stock market's opening week has been marked by notable declines, particularly in technology sectors, as fears surrounding AI continue to shape investor behavior. With critical earnings reports on the horizon, market participants remain vigilant, seeking clues that could signal a shift in sentiment or a further downturn.

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