U.S. stocks extended losses on Wednesday as concerns over stretched equity valuations weighed on investor sentiment.
The Dow Jones Industrial Average fell by 171.50 points, or 0.37 percent, to 46,121.28. The Standard and Poor's 500 sank 18.95 points, or 0.28 percent, to 6,637.97. The Nasdaq Composite Index shed 75.62 points, or 0.33 percent, to 22,497.86.
Seven of the 11 primary Standard and Poor's 500 sectors ended in red, with materials and real estate leading the laggards by losing 1.59 percent and 1.01 percent, respectively. Meanwhile, energy and utilities led the gainers by adding 1.23 percent and 0.73 percent, respectively.
Sales of new single-family homes in the United States saw gains in August, the Commerce Department's Census Bureau reported Wednesday.
Meanwhile, tech shares were mixed. Oracle fell 1.71 percent and Nvidia dropped 0.82 percent, each posting a second consecutive decline, while Amazon slid 0.23 percent for its third straight loss.
By contrast, U.S.-listed Alibaba shares surged over 8 percent after the company boosted its budget for AI infrastructure and models. Marvell Technology jumped more than 7 percent to lead the Nasdaq, and Intel climbed 6.41 percent.
However, investors continued trimming AI-related names after a report from The Information said OpenAI is considering leasing Nvidia chips rather than purchasing them outright.
Traders also turned cautious ahead of key U.S. jobless claims data on Thursday and the Fed's preferred inflation gauge, the Personal Consumption Expenditures Price Index on Friday, while keeping an eye on developments surrounding a potential government shutdown.
U.S. stocks close lower as tech stocks retreat on AI spending concerns
U.S. stocks close lower as tech stocks retreat on AI spending concerns
