Market doubts grow over AI boom, U.S. stocks close mixed

Growing skepticism surrounding the artificial intelligence (AI) rally, which has propelled stock markets to new heights this year, is fueling increased selling pressure on technology stocks. This shift in market sentiment led to a mixed closing for Wall Street on July 29, 2026.

The Philadelphia Semiconductor Index experienced a significant downturn, dropping more than 4.49% to close at 11,035.68 points. This sharp decline reflects investor concerns about the sustainability of the AI-driven market surge and its impact on chip manufacturers, a key sector benefiting from AI advancements.

In contrast, the broader market showed resilience, albeit with modest gains. The Dow Jones Industrial Average rose by 537.24 points, or 1.03%, to settle at 52,747.32. The S&P 500 also saw a slight increase, adding 15.60 points, or 0.21%, to finish at 7,428.78.

However, the tech-heavy Nasdaq Composite Index bucked the trend of the other major indexes, closing down 55.17 points, or 0.22%, at 24,876.91. This performance underscores the sector-specific anxieties driving market dynamics, as investors reassess the valuations and future prospects of AI-related companies.