Stock Focus Report – Market Analysis for February 03, 2026

Tuesday’s session ended in the red as tech stocks dragged down the broader market, with the Nasdaq leading losses down 1.43% while the S&P 500 shed 0.84%. The Dow Jones showed relative resilience, declining just 0.34%, as old-guard industrials and retailers held firmer ground than their Silicon Valley counterparts.

PayPal (PYPL) led the decliners, plummeting $10.63, while semiconductor giants Nvidia (NVDA) and Broadcom (AVGO) each dropped more than 5 dollars per share. IBM (IBM) also joined the casualty list, falling over $20. The tech-heavy selloff overshadowed positive developments elsewhere in the market, including Walmart’s historic milestone and major M&A activity.

Treasury yields crept higher across the curve, with the 10-year adding 3 basis points to 4.27%, suggesting bond investors aren’t exactly rushing to safety despite the equity selloff. Bitcoin joined the pain party, dropping nearly 2% to $76,689.

The retail sector provided the day’s brightest spot as Walmart (WMT) crossed the $1 trillion market cap threshold for the first time, joining an elite club of American corporate giants. The milestone cements Walmart’s transformation from brick-and-mortar dinosaur to omnichannel powerhouse, proving Main Street can still compete with Silicon Valley.

Financials made headlines as Spain’s Santander (SAN) announced a blockbuster $12.2 billion acquisition of regional bank Webster Financial (WBS), marking one of the year’s largest banking deals. Meanwhile, private equity heavyweight KKR is preparing to take Wella Company—owner of OPI nail polish—public in what could be a significant IPO later this year.

The chip sector faced scrutiny despite Nvidia CEO Jensen Huang’s attempt to calm markets, telling CNBC’s Jim Cramer there’s “no drama” around the company’s OpenAI investment plans. His reassurance didn’t prevent NVDA from sliding $5.27. Intel (INTC) tried to steal some thunder by announcing plans to develop GPUs and hiring a key executive, directly challenging Nvidia’s dominance in the lucrative graphics chip market.

Investor sentiment turned cautious as the tech sector’s recent momentum hit a speed bump, with trillion-dollar questions emerging about valuations and growth sustainability. The selloff in mega-cap tech names suggests profit-taking may be underway after months of relentless gains, though there’s little evidence of outright panic.

Alphabet (GOOG, GOOGL) faced pressure on two fronts: most U.S. states are appealing a decision in the major antitrust case against the search giant, while Bloomberg reported the company plans to significantly expand operations in India amid stricter U.S. visa rules. The India expansion could involve acquiring millions of square feet of office space, signaling a strategic geographic shift.

Speculation around Elon Musk’s empire added another layer of uncertainty, with experts debating whether a potential Tesla-SpaceX merger would benefit shareholders or simply serve Musk’s vision of corporate “convergence.” The Tesla (TSLA) story exemplifies the market’s current struggle between innovation narratives and valuation reality.

Today’s session reinforced an important lesson: not every day can be a tech rally, and even trillion-dollar companies face gravity occasionally. The divergence between Walmart’s ascent and PayPal’s plunge illustrates how quickly market leadership can rotate, especially when growth darlings stumble and value plays prove their worth.

The energy sector could see movement ahead as the Trump administration reportedly plans to issue licenses permitting expanded oil and gas production in Venezuela, potentially boosting output from the OPEC nation. This development could ripple through energy ETFs and commodity markets if companies can actually ramp production.

Keep an eye on the antitrust developments surrounding Alphabet and how Intel’s GPU ambitions materialize—the chip wars are heating up, and Nvidia’s dominance may finally face legitimate competition. With the dollar strengthening and yields climbing, the macro backdrop suggests investors are recalibrating risk preferences. The market’s ability to digest tech weakness while maintaining relatively orderly conditions will be crucial in the sessions ahead.