S&P 500 Retreats From Record as Tech Giants Stumble on AI Layoffs — TXN Surges 19%, Brent Tops $106, Intel Soars After Hours

Wall Street’s record-setting momentum hit a wall Thursday as the S&P 500 retreated 0.42% from Wednesday’s all-time closing high, dragged lower by a cascade of negative headlines across the technology sector. Microsoft’s first-ever voluntary employee buyouts, Meta’s 8,000-person workforce reduction, ServiceNow’s worst single-day collapse since 2020, and IBM’s continued post-earnings slide combined to make tech the session’s worst-performing sector by a wide margin.

But beneath the headline decline, a powerful rotation was underway. Texas Instruments exploded 19.4% higher on blowout data center chip demand, Vertiv surged 5.4% on infrastructure earnings, and utilities led all sectors with a 2.7% gain. The PHLX Semiconductor Index posted its 17th consecutive day of gains. And after the bell, Intel lit up the tape — soaring roughly 14.6% on a Q1 earnings beat and strong guidance, validating the hardware-over-software thesis that has dominated this earnings season.

Meanwhile, Brent crude punched above $106 per barrel as Strait of Hormuz tensions continued to escalate between the U.S. and Iran, adding energy inflation risk to an already complex macro picture.

Closing Scoreboard

What Happened

Futures had signaled weakness heading into the open after Brent crude’s push above $104 overnight rattled risk appetite, and the session broadly followed through on that bearish setup. The S&P 500 opened below Wednesday’s record close and spent much of the morning drifting lower, touching 7,046.55 at its intraday low — a 1.3% peak-to-trough swing from yesterday’s 7,147.78 high watermark.

The catalyst cocktail was potent: Microsoft reported that it was offering voluntary buyouts to up to 7% of its U.S. workforce — the first such program in the company’s 51-year history — as AI infrastructure spending reshapes headcount priorities. Simultaneously, Meta announced plans to eliminate 8,000 positions as AI costs balloon. The juxtaposition was stark: companies are spending tens of billions on AI chips and data center capacity while cutting the humans who built their current businesses.

ServiceNow remained the poster child for software carnage, cratering another 17.7% to $84.78 after Wednesday’s post-earnings rout on revenue misses and billings deceleration. IBM extended its losses to −8.3% as markets continued to digest a cloud revenue miss and consulting weakness. Lululemon plunged 13.3% after announcing a CEO change, bringing in ex-Nike executive Heidi O’Neill to replace the departing chief.

A late-session bounce pared losses — the S&P recovered roughly 60 points from its intraday low — but buyers lacked conviction to push back to flat. Notably, defensive sectors carried the late rally: utilities surged 2.7%, consumer staples gained 1.7%, and real estate added 1.2%. The rotation from growth to defensives and real assets (energy, commodities) was the clearest single-day signal in weeks that the market is recalibrating for a higher-inflation, higher-oil environment.

Mega-Cap and Key Movers

Sector Breakdown

The sector dispersion was extraordinary: nearly 4.1 percentage points separated the best performer (utilities, +2.7%) from the worst (technology, −1.4%). This is the widest intraday rotation spread in over two weeks and underscores the defensive repositioning underway. Utilities benefited from both yield-seeking flows and the data center power narrative — GE Vernova’s electrification backlog surging from $9 billion in late 2022 to $42 billion is a structural tailwind for the entire sector.

Global Markets

Asia-Pacific

Japan’s Nikkei 225 hit a fresh all-time high before settling with modest losses of 0.75% at 59,140 as the yen weakened. Hong Kong’s Hang Seng fell 0.95%, Shanghai Composite dipped 0.32%, and India’s SENSEX dropped 1.09% on energy cost concerns as Brent pushed above $104 during Asian trading hours. South Korea’s KOSPI extended its record-breaking rally streak.

Europe

European bourses closed mixed to lower as energy inflation fears intensified. The DAX fell 0.57%, the FTSE 100 declined 0.85% despite energy sector strength, and the STOXX 50 lost 0.79%. The CAC 40 bucked the trend with a marginal 0.19% gain. UK CPI data released overnight showed headline inflation rising to 3.3%, stoking stagflation concerns for the Bank of England.

Fixed Income and Commodities

Treasury yields were remarkably stable despite the equity volatility. The 10-year held at 4.30%, the 2-year ticked up a single basis point to 3.79%, and the 2s/10s spread narrowed marginally to +51 basis points. The bond market appears to be waiting for harder data before repricing — specifically, how surging oil prices filter through to inflation expectations.

Gold settled at $4,706.50, slipping 0.2% as the dollar stabilized modestly. The broad dollar index (DTWEXBGS) edged down to 118.08, continuing the greenback’s worst month since August — down 2.3% from late March. EUR/USD held at 1.1686. Bitcoin firmed 0.6% to $77,955, continuing to trade independently of equities in recent sessions.

Corporate News

Microsoft and Meta: AI’s Human Cost

Microsoft’s decision to offer voluntary buyouts to 7% of its U.S. workforce marks a historic first for the company. Coming alongside Meta’s plan to cut 8,000 positions, the message is clear: Big Tech is reallocating capital from headcount to compute. MSFT fell 4.0% to $415.75, its worst session in over a month. META shed 2.3% to $659.15.

Avis Budget’s Meme Unwind

CAR cratered 48.4% to $229.14, erasing roughly half of its 600% meme-driven rally. The collapse was the largest single-stock percentage decline on the S&P 500 in months and serves as a reminder that momentum cuts both ways when fundamentals can’t support the price.

Other Corporate Headlines

• Lululemon named ex-Nike executive Heidi O’Neill as CEO; stock fell 13.3% to a 52-week low of $141.66
• Best Buy named insider Jason Bonfig as CEO; shares fell 3.2% to $61.50
• Trump Media CEO Devin Nunes resigned
• Boeing delivered 143 jets in Q1, narrowed losses from $31M to $7M, and maintains an $86B defense backlog. Wolfe Research raised its price target to $275
• Google unveiled two new AI chips to compete with Nvidia, pressuring NVDA by 1.4%
• SoftBank is seeking a $10B loan backed by OpenAI shares
• Cannabis stocks surged after Trump moved to formally reclassify marijuana

Economic Data

Initial jobless claims came in at 214,000 for the week ending April 18, well below the 222,000 consensus. While the headline looks solid, the upward tick from the prior week’s 208,000 reading suggests the labor market may be losing a bit of momentum at the margin. Still, sub-220K claims remain historically tight and give the Fed no urgency to cut rates.

Analyst Actions

• ServiceNow (NOW): Wolfe Research slashed PT to $125 from $175; UBS cut to $120 from $125; Barclays reinstated coverage at Overweight with $132 target
• Texas Instruments (TXN): Wolfe Research raised PT to $315 from $260; Truist raised to $278 from $225
• Boeing (BA): Wolfe Research raised PT to $275 from $250
• Huntington Bancshares (HBAN): Piper Sandler upgraded to Neutral from Underweight
• Applied Digital (APLD): Roth Capital raised PT to $65 from $58

After-Hours Movers

Intel was the undisputed star of the after-hours session, surging approximately 14.6% to ~$76.51 on a Q1 earnings beat with strong Q2 guidance. The move validates Intel’s 14A process node strategy — the same node Tesla recently selected for its next-generation chip production. The semiconductor index’s 17-day winning streak appears poised to extend to 18 on Friday.

The AlphaEdge Take

Thursday’s session was not really about a 0.42% decline in the S&P 500. It was about what’s happening underneath the surface — and the message is becoming harder to ignore.

The market is undergoing a profound rotation from software to hardware, from growth to defensives, and from financial engineering to physical infrastructure. Texas Instruments’ 19.4% single-day surge was not a fluke — it was a statement from the market that analog chips powering data centers, industrial automation, and electric vehicles are more valuable right now than enterprise software subscriptions. ServiceNow’s 17.7% collapse and IBM’s 8.3% slide tell the other side of the same story: companies that cannot demonstrate AI-driven revenue acceleration are being punished with extreme prejudice.

The oil wildcard adds another dimension. Brent above $106 with JPMorgan tracking Iranian shadow-fleet evasion attempts and RBC warning of a “cruel summer” creates a genuine stagflationary risk. If Hormuz disruptions escalate further, the Fed’s rate-cut calculus gets significantly more complicated — and the defensive rotation we saw today (utilities +2.7%, staples +1.7%) could become entrenched rather than tactical.

Intel’s after-hours moonshot crystallizes the investment thesis heading into Friday: the physical layer of AI — chips, power, cooling, cabling — is where the real money is being made right now. The semiconductor index’s 17-day rally is not a coincidence; it’s a repricing of the entire compute value chain. Expect the open tomorrow to be shaped by Intel’s results, but watch for whether the broader rotation from software to hardware and from growth to value continues. That rotation, more than any single earnings report, will define the trajectory of this market into May.