U.S. stocks were mixed on Wednesday, as investors weighed upbeat crypto momentum against rising geopolitical and fiscal concerns. As of early afternoon, the Dow Jones Industrial Average (DJI) fell 1.71%, underperforming major benchmarks. The S&P 500 (GSPC) dropped 1.21%, snapping a six-day winning streak, while the tech-heavy Nasdaq Composite (^XIC) edged 1.01% lower despite recovering from session lows earlier in the day.
Markets are digesting a fresh wave of economic uncertainties, from rising Treasury yields to the re-emergence of U.S.-China trade tensions and ongoing political infighting over President Trump’s expansive tax and spending proposals. At the same time, a surge in bitcoin helped buoy sentiment in some corners of the market, lifting select tech and crypto-adjacent names.
Market Movers:
- Target (TGT) -5.64%: Shares plunged after the retailer missed quarterly earnings estimates and slashed its full-year outlook. The company’s refusal to clarify whether it would pass on the cost of Trump’s new tariffs to consumers raised investor concerns about margin compression. Analysts noted the lack of guidance on pricing strategy added further uncertainty during a volatile retail environment.
- Alphabet (GOOGL) +3.35%: The stock rose after the tech giant showcased new AI innovations at its annual Google I/O conference. Investors responded positively to announcements including AI-integrated glasses and revamped search capabilities powered by its Gemini model. JPMorgan analysts issued bullish commentary, citing Alphabet’s leadership position in foundational AI.
- Canada Goose (GOOS) +24.16%: Shares soared following strong quarterly results that beat Wall Street expectations. The luxury apparel maker benefited from strong net sales and improved margins, easing concerns about consumer discretionary spending in a high-rate environment. Investors were encouraged by management’s upbeat outlook for the year ahead.
- CoreWeave (CRWV) +14.65%: Nvidia-backed AI infrastructure firm CoreWeave continued its explosive rally, fueled by a bullish price target upgrade from Citi. Analyst Tyler Radke raised his target to $94, citing impressive revenue momentum and strong demand from hyperscalers like Azure. Despite the stock more than doubling since its IPO, Citi maintained a “Neutral/High Risk” rating due to profitability concerns.
- Coinbase (COIN), Marathon Digital (MARA), Riot Platforms (RIOT) – Mixed: Crypto-related stocks saw volatile trading as bitcoin surged to a new record above $109,000. Coinbase gained, while bitcoin miners like Marathon and Riot saw choppier action amid broader market weakness. The rally in digital assets comes amid escalating trade tensions and fiscal worries, suggesting some investors are seeking refuge in crypto.
Bitcoin Rally Signals Diverging Investor Sentiment
Bitcoin’s surge to an all-time high of $109,468 on Wednesday showed diverging investor sentiment in a time of macroeconomic uncertainty. The cryptocurrency’s rise came amid renewed tensions with China, as well as growing unease around the U.S. debt situation and the strength of the dollar. As bond yields spike, some investors are rotating into risk assets like crypto in a bid to hedge against inflation and geopolitical instability.
This bitcoin rally also boosted sentiment in select corners of the equity market, particularly for firms with exposure to digital assets and blockchain technology. However, the rally has not translated into uniform gains for all crypto-related equities, reflecting caution about sector-specific fundamentals.
US-China Chip Dispute Fuels Trade Worries
Markets were rattled by developments in the U.S.-China chip standoff, only days after a fragile truce was announced. The Trump administration's warnings against Huawei's AI chip usage undermined recent diplomatic efforts and reignited concerns about retaliatory measures. China criticized the move, threatening to walk back recent agreements struck during Geneva talks.
Investors fear the renewed tension could have a cascading effect on global supply chains, particularly in the semiconductor sector. Although major tech stocks rebounded slightly by midday, sentiment remains fragile. The escalating rhetoric has added to investor anxiety already stoked by uncertainty surrounding Trump’s fiscal plans and deficit-driven bond market volatility.
Market Rotation Toward Stock-Specific Fundamentals
Wall Street strategists suggest that the market may be transitioning away from macro-driven swings and back toward a focus on company-specific fundamentals. Recent data show correlations between S&P 500 constituents have fallen significantly, indicating a return to what some call a “stock picker’s market.”
This trend follows several months of macro-dominant trading, driven largely by headlines surrounding tariffs, inflation, and monetary policy. Analysts at Piper Sandler noted this shift could help stabilize investor sentiment, even as broader economic risks persist. Companies delivering strong execution and innovation, particularly in AI and technology, are increasingly rewarded, while underperformers are punished.
Looking Ahead
As markets continue to digest conflicting signals, from trade tensions and political uncertainty to surging crypto assets and sector-specific earnings, volatility will likely remain elevated. Investors will be closely watching updates on Trump’s proposed tax-and-spending bill, developments from the G-7 summit, and any new commentary on tariffs and U.S.-China relations.
The next few trading sessions could set the tone for the remainder of the quarter, particularly if macroeconomic headlines give way to earnings season results and more granular company performance. For now, markets are attempting to recalibrate after a volatile week, with no shortage of catalysts on the horizon.