Rebound Effort: Stocks Rise Despite Amazon's Dive

Published as of: February 6, 2026, 9:18 a.m. ET

(Friday market open) A miserable week for tech mercifully approaches the finish line today. Major indexes posted early gains despite Amazon's (AMZN) plunge after it spooked investors with heavy spending plans. The tech-packed Nasdaq-100^® (NDX) is down 4% from last Friday's close as software and AI shares weakened, and bitcoin is in even worse shape, down 50% from October's all-time high and trading at levels last seen before the November 2024 election. The S&P 500 Index is now red for 2026, wiping out roughly $1 trillion in market capitalization.

Investors regroup today, awaiting consumer sentiment data soon after the open following yesterday's surprising surge in January layoffs and a slide in job openings that weighed on Treasury yields. If consumers prove unhappy, it might point back to those employment reports. Coming days are huge from a data perspective with nonfarm payrolls due Wednesday and the Consumer Price Index (CPI) a week from now. Earlier this week, the ISM Manufacturing PMI^® showed expansion, but things weren't glowing underneath, with a "stark difference between the strong headline report and the very somber verbatim comments from survey respondents," said Liz Ann Sonders, chief investment strategist at the Schwab Center for Financial Research (SCFR).

On Thursday, investors found few places to hide amid torrid selling as every major index fell 1% or more. Light gains occurred in traditionally defensive sectors like consumer staples and utilities, along with perceived safe havens including the U.S. dollar and Treasuries. But bitcoin was the real spoiler of the party, dragging crypto-related stocks and casting a pall as investors worried that crippled crypto might translate into weakness elsewhere. Bitcoin rebounded slightly early today, still at 16-month lows, while AI and chip-related stocks drove overnight gains on Wall Street. Nvidia (NVDA) rose more than 2.5%.

1. Yin and yang persist: Yesterday's generally dismal jobs data landed with a thud in a market that's increasingly as two-toned as a 1950s sedan. While the tech sector scurries lower and prevents major indexes from gaining, there's often been strength beneath the surface, excluding yesterday's widespread selloff. Market breadth remains solid with 64% of S&P 500 stocks trading above their 50-day moving average by Thursday's close. Over the month heading into Thursday, the S&P 500 Index barely moved, but eight of 11 S&P sectors rose between the end of January and the middle of this week, with three up double-digits. Energy, materials, and industrials continue to benefit from the AI build-out, and that's also helped international stocks as those cyclical sectors, rather than tech, dominate their economies. "Rotation is the new momentum trade," my colleague Sonders said in an interview Thursday with Bloomberg. "There's a lot of money positioned to find not just what's the shiny new object but what's the dull new object and chase that rotation. I think we stay in that environment at least in the near term. The broadening has legs. It has fundamental underpinnings to it."
    
2. Chips are down, could dip buying arrive? The sickness at the heart of the market is in chips, where a shortage in the memory market has raised prices and hurt guidance for some major firms like Intel (INTC) and Qualcomm (QCOM). Software shares are in freefall on the same worries that haunted the space for a while about AI intruding. Concerns about heavy spending by mega-cap data center companies like Alphabet (GOOGL) and Amazon also weigh on tech, though in the longer run that sounds like it might be sunny news for companies that make the AI chips that data center firms are scooping up. However, the semiconductor sector hit correction territory this week, down 10% from recent all-time highs. While past isn't precedent, the chip market's recent history features regular pullbacks. They occurred almost every month late last year and always preceded a rally. "Buy the dip" hasn't shown up yet this week, but with the tech market down so much, so fast, it can't be ruled out. In fact, many chip stocks clawed back from their worst losses late yesterday. Software firms saw little relief.
    
3. Critical data week approaches, but first Japan votes: Looking ahead, analysts expect Wednesday's nonfarm payrolls report to show relatively weak January jobs growth near 70,000, not improved much from 50,000 in December. Meanwhile, inflation remains a concern, stuck near 3%. Federal Reserve speakers this week sounded uninterested in cutting rates, though they receive two jobs reports between now and the mid-March meeting. On another rate-related note, Japan's election this Sunday could send volatility even higher on Wall Street. "Prime Minister Takaichi is likely to increase the majority for her coalition and pursue additional fiscal spending," said Michelle Gibley, director of international equity research and strategy at SCFR. More fiscal stimulus could raise Japanese yields and threaten to send U.S. yields up as Treasuries face more competition.

• Amazon fell more than 8%. Quarterly revenue and guidance were in line and Amazon Web Services cloud sales rose 24%, a sequential improvement, as overall the results mostly exceeded Wall Street's thinking. Anticipated capital spending plans likely brought much of the pressure, driving worries about margins and return on invested capital. Amazon said on its earnings call it is monetizing AI as fast as it installs it.
   
• While Amazon isn't a tech stock per se (it trades in the consumer discretionary sector), its results and spending plans apparently had an effect on tech, especially the AI sector. The heavy spending has to land somewhere, and investors today appeared to remember that, pushing shares of Nvidia, Micron (MU), Western Digital (WDC), and Advanced Micro Devices (AMD) up 2% or more.
   
• Software shares rebounded slightly Friday morning. Salesforce (CRM) climbed 1.2% and Adobe (ADBE) slightly less than 1%. The software sector's forward price-to-earnings (P/E) ratio has been cut by 10.7 points over the past four months, the largest decline since 2002.
   
• Eli Lilly (LLY), which ascended double digits Wednesday on strong earnings, rolled back most of those gains Thursday as Hims & Hers Health (HIMS) announced plans for a $49 weight loss pill. Lilly competitor Novo Nordisk (NVO) also dropped sharply, and Novo threatened legal and regulatory action against Hims and Hers, Bloomberg reported. Both Lilly and Novo-Nordisk clawed back some of those losses in early trading today while Hims & Hers cratered.
   
• Stellantis (STLA) cratered 24% this morning after the automaker announced $26 billion in charges related to a business restructuring that includes pulling back on electrification plans, CNBC reported.
   
• Thursday had one sweet spot. Hershey (HSY) rose 9% after beating analysts' estimates on earnings and outlook.
   
• Metals were mixed early Friday in a week that saw silver slip another 12% after last Friday's epic losses. Silver fell nearly 2% this morning. Gold is up fractionally for the week and 1% today. Investors have their eyes on geopolitical developments this morning, specifically nuclear talks between Iran and the U.S. If that situation deteriorates, gold might get another bid.
   
• Bitcoin (/BTC) climbed 4% this morning in what appeared to be a technical move, helping lift shares of Strategy (MSTR) and Coinbase (COIN) by 6% and 5%, respectively. Some analysts say the crypto selling is contained, but it's also possible that investors heavily leveraged in crypto might face pressure to sell equities and other assets as they struggle with crypto losses.
   
• The S&P 500 Equal Weight Index (SPXEW), which weighs all components equally rather than by market capitalization, is fractionally higher so far this week, compared with the S&P 500's 2% drop. The SPXEW is having its best week versus the SPX since November 2020.
   
• Looking at technicals, the S&P 500 Index finished well below its 50-day moving average of 6,877 on Thursday. It hadn't closed beneath that key support line since January 20. At points Thursday, it dropped under the 100-day moving average of 6,796, the first time since mid-November it lost grip on that. It hasn't closed under the 100-day since last spring's tariff tantrum but closed barely above it Thursday. It would likely take a few consecutive closes below the 100-day line to get investors worried about threats to the long-term technical uptrend.

Sonders on markets: Schwab's Sonders walked through her take on the latest Wall Street and economic trends in her February 2026 Market Snapshot video.

Schwab Sector Views: In the latest sector outlook, Schwab left its ratings unchanged. Check them out here.

Technically speaking, the S&P 500 Index (SPX—candlesticks) remains in its long-term uptrend but hit some bumps yesterday as it fell below its 50-day moving average (green line) of 6,881 and below its 100-day moving average (blue line) of 6,796. It was the first time it fell to the 100-day line since mid-November, though the 200-day average below 6,500 remains way below the market. The SPX hasn't closed under the 100-day since last spring's tariff tantrum. It would likely take several closes under that to really get attention and perhaps signal a major turning point in the rally. Generally, the index has traded in a range between roughly 6,500 and 7,000 (top and bottom light blue lines) since early October, showing little propensity to break through either the top of bottom of that.

Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.

February 9: Expected earnings from Cleveland-Cliffs (CLF), Becton, Dickinson & Co. (BDX), and CNA Financial (CNA).
February 10: December retail sales, November factory orders, and expected earnings from Coca-Cola (KO), CVS (CVS), AstraZeneca (AZN), Spotify (SPOT), Marriott International (MAR), BP (BP), Duke Energy (DUK), Lyft (LYFT), and Ford (F).
February 11: January nonfarm payrolls and expected earnings from McDonald's (MCD), T-Mobile (TMUS), Shopify (SHOP), Humana (HUM), Cisco (CSCO), and AppLovin (APP).
February 12: January existing home sales, and expected earnings from Anheuser-Busch (BUD), Applied Materials (AMAT), Arista Networks (ANET), Vertex Pharmaceuticals (VRTX), Brookfield (BN), Airbnb (ABNB), and Coinbase Global (COIN).
February 13: January CPI and January core CPI, and expected earnings from Enbridge (ENB) and Moderna (MRNA).