bitcoin fell below $74,000 in early entries of the US session, and the rebound from Tuesday’s lows quickly faded as weakness in tech stocks weighed on cryptocurrencies.
The Nasdaq 100 fell 1% after falling 1.5% the previous day. The software sector continued its decline, with the iShares Expanded Tech-Software Thematic ETF (IGV) falling another 4%, now down 17% in just over a week, amid fears that AI is severely disruptive.
Crypto miners, increasingly linked to building AI infrastructure, mirrored the decline, with Cipher Mining (CIFR), IREN and Hut 8 (HUT) falling more than 10%. The declines were due to chipmaker AMD, which fell 14% after its 2026 outlook fell short of analyst expectations.
Gold was also caught up in the selling, with the yellow metal quickly reversing an overnight rise to $5,113 an ounce and falling back below $5,000.
US economic data is mixed
The January ISM Services PMI was steady at 53.8, matching December’s revised reading and beating expectations by a hair, pointing to continued expansion in the services sector.
However, private employment growth slowed sharply, with just 22,000 jobs added according to an ADP report, well below forecasts of 48,000 and the already weak 37,000 in December. The government’s January jobs report would normally have been released this Friday, but the brief government shutdown has delayed it until next week.
“Manufacturing has lost jobs every month since March 2024 (Main Street recession), but this month professional and business services and large employers added to the weakness,” said Lekker Capital CIO Quinn Thompson, who believes markets are underestimating how much Fed stimulus could come in 2026.
