U.S. Stocks Slide as Economic Concerns Grow; Palantir Reports Record Quarter
U.S. stocks fell sharply on Tuesday as investors grew increasingly cautious about the health of the American economy while digesting another wave of corporate earnings reports.
At 09:35 ET (14:35 GMT), the Dow Jones Industrial Average dropped 405 points (0.9%), the S&P 500 slid 80 points (1.2%), and the Nasdaq Composite fell 388 points (1.6%).
Economic Health in Question
Concerns about the U.S. economy’s resilience prompted many investors to lock in recent profits amid fears that current stock valuations are overstretched. The Nasdaq Composite remains up 23% year-to-date, while the S&P 500 has climbed 16%, and the Dow Jones Industrial Average has gained 11%.
However, fresh data added to worries. The ISM manufacturing index showed factory activity contracted for the eighth consecutive month in October, coming in at 48.7, below the 50-point threshold that signals economic growth.
The ongoing U.S. government shutdown — nearing the longest in American history — has left both investors and the Federal Reserve with limited economic data to assess overall conditions.
While Fed Chair Jerome Powell recently suggested that the latest interest rate cut might be the final one of the year, policymakers Mary Daly and Lisa Cook hinted that another rate reduction in December remains possible.
Palantir Stock Drops Despite Record Revenue
The tech sector remained in focus, with Palantir Technologies (NASDAQ: PLTR) falling even after the company posted record quarterly results.
Palantir reported a net profit of $475.6 million on $1.18 billion in third-quarter revenue, both above expectations. In a letter to shareholders, CEO Alex Karp stated that the company is “now producing more profit in a single quarter than it did in total revenue not long ago.”
The firm expects stronger fourth-quarter sales, driven by booming AI adoption and growing demand for its data analytics software. Palantir has also expanded its government contracts, including a $500 million deal with the IRS and State Department.
Earnings in Focus: AMD, Uber, and More
Advanced Micro Devices (NASDAQ: AMD) will report results after market close, joining a wave of AI chipmakers releasing earnings amid an intense industry boom. Last month, AMD announced a multi-year partnership with OpenAI, providing AI chips in a deal expected to generate billions in annual revenue and grant the startup a 10% equity stake.
Elsewhere, Uber Technologies (NYSE: UBER) shares fell after the company issued weak guidance for the current quarter, overshadowing otherwise strong third-quarter earnings.
Meanwhile, Yum! Brands (NYSE: YUM) rose after revealing a strategic review of its Pizza Hut division, alongside better-than-expected Q3 results.
Marriott International (NASDAQ: MAR) shares also ticked higher as the hotel group reported rising profits thanks to steady demand for upscale lodgings, which helped offset weaker budget hotel sales.
Oil Prices Retreat on Supply Concerns
Crude oil prices moved lower Tuesday amid growing fears of a global supply glut following the latest OPEC+ meeting.
Brent crude fell 1% to $64.27 per barrel, while West Texas Intermediate (WTI) declined 1.1% to $60.41 per barrel. Over the weekend, OPEC+ agreed to a modest production increase for December and to pause further hikes in early 2026.
Traders now await U.S. inventory data from the American Petroleum Institute (API), expected later Tuesday, for more insight into global supply trends.
