[New York Stock Market Briefing] AI job-threat fears weigh on sentiment… Dow down 1%

U.S. stocks in New York closed lower on the 27th (local time). With concerns lingering over an AI-driven shock to employment, risk-off sentiment strengthened as U.K.-linked credit risks resurfaced and inflation data added to the burden.

At the New York Stock Exchange (NYSE), the Dow Jones Industrial Average fell 521.28 points (-1.05%) from the previous session to close at 48,977.92.

The S&P 500 slipped 29.98 points (-0.43%) to 6,878.88, while the tech-heavy Nasdaq Composite dropped 210.17 points (-0.92%) to finish at 22,668.21.

Market worries re-emerged that AI could reduce jobs and weaken legacy industries. Those concerns intensified after Block, a payments company founded by Twitter co-founder Jack Dorsey, said it would lay off about 4,000 employees—nearly half its workforce—citing the use of AI tools.

Fears also grew that mass layoffs could amplify the employment shock as AI adoption accelerates, aligning with projections in a Citrini Research report released last week titled “Global Intelligence Crisis 2028,” which warned AI innovation could trigger widespread unemployment and an unprecedented economic crisis.

Anxiety was further stoked by news that U.K. real-estate-backed lender Market Financial Solutions (MFS) filed for administration. Jefferies plunged 9.3% on reports it has exposure to MFS, while Apollo Global Management slid 8.57% on news that an affiliate holds exposure to MFS. Blue Owl Capital, a private equity firm whose shares have recently tumbled amid a redemption suspension, fell 5.97%.

As credit concerns spread, major Wall Street financial firms also posted steep losses, including Goldman Sachs (-7.47%), Morgan Stanley (-6.19%), Capital One Financial (-6.15%), Wells Fargo (-5.62%) and Citigroup (-5.16%).

Nvidia, the world’s largest AI chipmaker, fell another 4.16% after dropping 5.46% the previous day, as weakening risk appetite fueled skepticism about the sustainability of the “AI boom,” despite the company posting record results on the 25th. Data-center infrastructure provider CoreWeave tumbled 18.51% after investors were disappointed by its earnings outlook.

By contrast, Dell surged 21.93% after offering guidance that exceeded market expectations, despite concerns over the burden of higher memory prices.

Paramount Skydance jumped 20.84% on news it had signed an acquisition deal with Warner Bros. Discovery (Warner Bros.), and Netflix—after declaring it would forgo acquiring Warner Bros.—also ended the day up 13.77%.

Inflation data also weighed on sentiment. The U.S. Labor Department’s Bureau of Labor Statistics said the producer price index (PPI) rose 0.5% in January from the prior month. That was well above the Wall Street estimate (0.3%) compiled by Dow Jones. In particular, the index for trade services prices surged 2.5% month-on-month, leading the rise in services prices. Some analysts suggested U.S. companies running down inventories may be starting to pass tariff costs into product prices.

With risk aversion intensifying, Treasury yields declined. According to electronic trading platform Tradeweb, the 10-year U.S. Treasury yield stood at 4.96% near the New York stock-market close, down 6 bp (1 bp=0.01% point) from the previous session.

It marked the first time in three months—since late November last year—that the benchmark 10-year U.S. Treasury yield in global bond markets fell below 4%.

Reporter Shin Yong-hyun, Hankyung.com yonghyun@hankyung.com