The U.S. Stocks give up gain, Nasdaq drops led by Oracle

Stocks retreated on Wednesday as investors once again moved away from key technology names.

The S&P 500 traded 0.8% lower, while the Nasdaq Composite fell 1.1%. The Dow Jones Industrial Average slipped 100 points, or 0.2%.

Leading AI player Oracle and chipmaker Broadcom — two stocks that have led the recent rotation out of tech — were down more than 4% and more than 5%, respectively. Fellow leading AI player Nvidia was also down more than 3%.

“We definitely have seen a pretty clear rotation from large-cap growth into large-cap value, and what we’re really seeing is, I think, people positioning themselves in a more defensive posture for what’s going to happen next year,” said Brian Mulberry, client portfolio manager at Zacks Investment Management. “The real question that’s being asked is, ‘Who is going to monetize these very large investments in AI?’”

The latest moves add to the sizable losses Oracle and Broadcom have seen this month, a period that has seen investors move into other areas of the market like health care and financials. Month to date, Oracle and Broadcom have declined 10% and 19%, respectively.

That might not be stopping anytime soon, according to Mulberry. He expects the rotation away from some of the highly valued names to more fairly valued sectors to persist into 2026, and that — along with uncertainty around monetary policy — could bring about some volatility.