Dow Dives 797 Points as Government Opens: Stock Market Today
The process of pricing and re-pricing realities old and new never stops, and next week promises to be at least as exciting as this week.
President Donald Trump signed a short-term spending bill Wednesday night that reopens the federal government through January 30. Investors, traders and speculators are assessing the implications of the longest government shutdown in U.S. history, which includes the resumption of regular collecting and reporting of economic data.
Meanwhile, in addition to its leader providing another quarterly update on the AI revolution next week, a number of important retailers will offer a look at the health of the American consumer.
The usual sectors reflected a risk-off mood – communication services, technology and consumer discretionary stocks were three of the biggest losers. Utility stocks were also among the worst of the worst, but that price action mirrors renewed questions about whether we're in an AI bubble. Indeed, all that potential computing power requires a lot of electricity.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Nvidia (NVDA) was down 3.6%, as its turn next Wednesday on the earnings calendar marks a defining event for the rest of 2025. Tesla (TSLA) shed 6.6%.
Other Magnificent 7 stocks suffered similar fates: Alphabet (GOOGL) lost 2.8%, Amazon.com (AMZN) 2.7%, Microsoft (MSFT) 1.5% and Apple (AAPL) 0.2%. Meta Platforms (META), meanwhile, eked out a 0.1% gain after Wedbush added the Facebook and Instagram parent to its Best Ideas List.
And Constellation Energy Group (CEG) – one way to invest in a nuclear revolution driven by AI electric power needs – was down 5.2%.
But Cisco Systems (CSCO) bucked the trend, rising 4.6% and earning multiple analyst upgrades after reporting expectations-beating fiscal 2026 first-quarter results on Wednesday – all of it a function of the AI-driven demand cycle.
"The market is hungry for economic data now that the government is reopened," writes Louis Navellier of Navellier & Associates, who says non-government data shows "a fairly ugly" employment situation marked by low hiring and large layoffs. "While a weakening employment picture should push the Fed to cut in December," he says, "there may be inflation concerns that give them pause."
As Navellier notes, "A robust outlook by [Nvidia] CEO Jensen Huang is key to a strong year-end for the stock market."
At the closing bell, the blue chip Dow Jones Industrial Average was down 1.7% at 47,457, the broad-based S&P 500 had fallen 1.7% to 6,737, and the tech-heavy Nasdaq Composite was off 2.3% at 22,870.
DIS is a streaming stock
Walt Disney (DIS, -7.8%) was down big Thursday after management reported fiscal 2025 fourth-quarter results. Traffic at its U.S. amusement parks was down by 1%. The Dow Jones stock was also hampered by an ongoing dispute with Alphabet's YouTube unit, for which no end is in sight.
Disney posted earnings of $1.11 per share, down from $1.14 a year ago and above the $1.05 Wall Street consensus. Revenue slipped to $22.46 billion and came up short of analysts' expectations for $22.76 billion. Operating income for its entertainment segment was down 35% on declining TV advertising and box-office sales.
Disney did see profit growth for its streaming and experiences segments, as Disney+ added 3.8 million subscribers and overseas theme parks enjoyed strong foot traffic. And management reiterated guidance for double-digit EPS growth in fiscal 2026 and 2027.
Disney continues to negotiate a new streaming agreement with YouTube. Management said in a statement that it "cannot predict how long this service blackout will last or reasonably estimate the adverse impact on our results of operations."
About next week
"The market may be near all-time highs," writes independent analyst Jeff Macke, "but in terms of the economy, America is driving in the dark with the headlights off and the gas pedal to the floor."
As Macke explains, the gap on the economic calendar wasn't "magically fixed when the shutdown officially ended last night." Questions remain about when airlines will resume full operations, for example, and whether October economic reports will ever be released.
"Which is the bad news," the analyst concludes. "The good news is we're about to find out everything we need to know about the consumer, for better or worse."
Macke is referring to next week's earnings calendar, which, in addition to Nvidia, features Home Depot (HD, -0.8%), Lowe's (LOW, -1.4%), TJX (TJX, -0.5%), Target (TGT, -1.4%), Gap (GAP, -2.5%) and Walmart (WMT, -0.8%).
Walmart, of course, is both the biggest retailer and the biggest private employer in the world. We'll see what its numbers and its managers say before the opening bell next Thursday, the morning after Nvidia reports.
Related content
- 5 Core Stocks Every Investor Should Own in 2026 and Beyond
- Dividend Increases: 3 Stocks With Rising Payouts
- What's Next for the Fed – as an Institution?
-
What to Watch for When Refinancing Your Home MortgageA smart refinance can save you thousands, but only if you know how to avoid costly pitfalls, calculate true savings and choose the right loan for your goals.
-
The 10 Best Splurge Destinations for Retirees in 2026Come for the luxury vacation. Retire for the lifestyle (if the vacay goes well). What better way to test a location for retiring abroad?
-
Builders Are Offering Big Mortgage Incentives — What Homebuyers Should Watch ForBuilder credits and below-market mortgage rates can ease affordability pressures, but the savings often come with trade-offs buyers should understand before signing.
-
What Changed on January 1: Check Out These Opportunities Created by the New Tax LawA deep dive into the One Big Beautiful Bill Act (OBBBA) reveals key opportunities in 2026 and beyond.
-
Beat the Money Blues With This Easy Financial Check-In to Get 2026 Off to a Good StartAs 2026 takes off, half of Americans are worried about the cost of everyday goods. A simple budget can help you beat the money blues and reach long-term goals.
-
Do Self-Storage REITs Deserve Space in Your Portfolio? It's a Yes From This Investment AdviserSelf-storage is an overlooked area of the real estate market, even though demand is strong. Investors can get in on the action through a REIT.
-
Dow Hits a Record High After December Jobs Report: Stock Market TodayThe S&P 500 also closed the week at its highest level on record, thanks to strong gains for Intel and Vistra.
-
The December Jobs Report Is Out. Here's What It Means for the Next Fed MeetingThe December jobs report signaled a sluggish labor market, but it's not weak enough for the Fed to cut rates later this month.
-
4 Simple Money Targets to Aim for in 2026 (And How to Hit Them), From a Financial PlannerWhile January is the perfect time to strengthen your financial well-being, you're more likely to succeed if you set realistic goals and work with a partner.
-
Estate Planning Isn't Just for the Ultra-WealthyIf you've acquired assets over time, even just a home and some savings, you have an estate. That means you need a plan for that estate for your beneficiaries.
-
How to Be a Smart Insurance Shopper: The Price Might Be Right, But the Coverage Might Not BeChoosing the cheapest policy could cost you when you have a loss. You'll get the best results if you focus on the right coverage with the help of a good agent.
