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US stocks saw mixed moves on Thursday as investors weighed a tech-led pullback against a sharp rally in defense names. Traders also kept focus on Friday’s US payrolls report, after mixed labor signals and a rebound in Treasury yields.
Big technology shares dragged on the NASDAQ 100 after a strong early-year run in the artificial-intelligence trade. NVIDIA and Apple both fell, while several other mega caps also declined, and the tech sector lagged the broader market.
The S&P 500 held near flat territory, while the Dow Jones Industrial Average outperformed as investors rotated toward more defensive exposures. In Europe, the Stoxx Europe 600 slipped, and the MSCI World Index also edged lower, tracking the softer tone in risk assets.
Investors also shifted positioning ahead of earnings season, which starts in the coming weeks. Many traders chose to lock in gains in the largest AI-linked names after a three-day advance in the NASDAQ 100. The left rotation indexes steadier overall, but it also raised sensitivity to any guidance on spending, margins, and cloud demand.
Defense stocks rose after President Donald Trump signaled plans to push US military spending to $1.5 trillion in 2027. Contractors, including Lockheed Martin, Northrop Grumman, RTX, and Kratos led gains as traders priced in higher budget support for weapons and systems programs.
Markets also reacted to a tougher stance on shareholder payouts at defense firms. Trump issued an executive order that bars major defense contractors from paying dividends or conducting stock buybacks until they improve production performance, and he also called for linking executive pay to delivery targets.
US Treasuries lost some ground, with the 10-year yield rising around the 4.17% area as traders reassessed recession risks. Weekly jobless claims rose less than expected, while layoff data showed improvement, which reduced demand for duration and kept rate-cut expectations in check ahead of payrolls.
In foreign exchange, the dollar index inched higher as the euro and pound eased. Bitcoin and ether also softened as investors trimmed risk in the data. Crude oil advanced, while spot gold and silver fell for a second day as traders positioned for annual commodity index rebalancing that could trigger large, mechanical futures selling over the coming sessions.
Credit markets stayed active. Companies and governments tapped bond markets heavily in early January, and investors expected a new wave of issuance in Europe and Asia. The supply outlook added another reason for traders to watch yields closely as earnings season approaches and policy headlines remain in focus.
Also Read: US Stock Market Today: NASDAQ Edges Up, Dow Slips as Mixed US Data Tests Early-2026 Risk Appetite
