Wall Street weakened as valuation worries resurfaced ahead of Nvidia’s quarterly earnings, with the company’s stock dropping 1.8%. Investors are anxious that Nvidia’s results and outlook will determine whether the AI-driven market momentum can continue or if fears of a tech bubble will intensify. Analysts caution that simply meeting expectations won’t suffice—Nvidia must deliver a strong beat to sustain confidence in the sector.

Meanwhile, U.S. traders focused on delayed economic data following the government shutdown. Construction spending unexpectedly rose in August, while upcoming reports on factory orders, trade balance, and September jobs could shape interest rate expectations before the Fed’s December meeting. The CME FedWatch Tool currently signals slightly higher odds of rates staying unchanged than of a quarter-point cut.

Airline stocks substantial moved downwards, dragging the NYSE Arca Airline Index down by 3.7% to its lowest closing level in over three months. Financial stocks were significantly weak, with the NYSE Arca Broker/Dealer Index and the KBW Bank Index tumbling by 3.4% and 2.7%.

Housing stocks was considerably weak, as reflected by the 2.7% slump by the Philadelphia Housing Sector Index. Energy, networking and semiconductor stocks also saw notable weakness while some strength emerged among utilities stocks.

Asia-Pacific stocks turned in a mixed performance. Japan's Nikkei 225 Index edged down by 0.1% and China's Shanghai Composite Index fell by 0.5% while South Korea's Kospi shot up by 1.9%. The major European markets all moved to the downside While the German DAX Index slumped by 1.2%, the French CAC 40 Index slid by 0.5% and the U.K.'s FTSE 100 Index slipped by 0.2%.

In the bond market, treasuries regained ground after moving lower over the two previous sessions. As a result, the yield on the benchmark ten-year note, which moves opposite of its price, dipped 1.5 bps to 4.13%.