The Dow Jones Industrial Average hit a fresh record high on Monday, after topping 50,000 for the first time last week. The S&P 500 and teach-heavy Nasdaq also climbed, continuing to reverse major losses suffered days earlier.
The performance marked the latest move in topsy-turvy markets — and that rollercoaster may very well continue, some analysts told ABC News.
Analysts attributed the volatility to a flurry of developments in artificial intelligence (AI), and a perception of looming geopolitical uncertainty. Mixed signals in economic data have also left markets uneven, some analysts added. Such factors could keep stock prices on edge, they said, before noting the difficulty of predicting short-term stock performance.
“AI is driving extreme reactions,” Ivan Feinseth, a market analyst at Tigress Financial, told ABC News. “That volatility is going to increase.”
Shares of some tech companies worldwide plummeted last week after Anthropic unveiled an AI tool viewed by some investors as a potential replacement for widely-used software products.
Anthropic released a set of new plugins for a digital tool called Claude Cowork, an AI-fueled workplace assistant that can author documents and organize files. The plugins, released on Jan. 30, allow customers to adapt the tool for narrow sectors like legal, finance or data marketing.
“There’s a worry that AI will eventually disrupt those businesses,” Bret Kenwell, an investing analyst at eToro, told ABC News. “People are looking at these losses, selling first and asking questions later.”
Some tech giants, meanwhile, revealed plans for massive investments in AI. On Thursday, Amazon forecasted $200 billion in spending on AI this year, which would amount to a 50% jump in its capital expenditure from 2025. Shares of the company have fallen more than 10% since the start of last week.
In all, four major tech companies — Amazon, Microsoft, Google and Meta — are expected to spend a combined $630 billion this year, Reuters reported. Each of those companies saw shares fall over the past week.
Many other stocks turned higher late last week, including companies in the energy and industrial sector, according to Kenwell.
“The Dow is at record highs but if you look at crypto or technology, investors don’t feel that way,” Kenwell said. “Some areas are insulated and some areas are fully exposed.”
Traders work on the floor of the New York Stock Exchange (NYSE), Feb. 9, 2026, in New York.
Spencer Platt/Getty Images
Meanwhile, some analysts said, geopolitical conflict looms amid negotiations over Greenland, U.S.-backed leadership in Venezuela, the ongoing war between Russia and Ukraine, as well as tensions between the U.S. and Iran.
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In recent weeks, President Donald Trump has threatened tariffs against Canada, South Korea and eight European countries, invoking the tool as means of exerting pressure over a range of foreign-policy issues.
“There are so many uncertainties there,” Jay Ritter, a finance professor at the University of Florida, told ABC News.
To be sure, the stock market has climbed in recent weeks, despite some turmoil. The Dow has climbed about 4% since the outset of this year, while the S&P 500 has jumped nearly 2%. The Nasdaq has inched up 0.2% over that span.
Stretching back to the beginning of last year, each of the major indexes has posted double-digit gains.
It has proven difficult, however, to assess the health of the economy, some analysts said. The labor market has slowed in recent months, while inflation has hovered above the Federal Reserve’s target rate of 2%.
Still, some major indicators have displayed resilience. In the fall, shoppers helped propel the fastest quarterly U.S. economic growth in two years, federal government data in December showed.
A relatively small fraction of American adults are unemployed and looking for work. The unemployment rate dropped to 4.4% in December from 4.6% in November, the U.S. Bureau of Labor Statistics said, putting unemployment at a low level by historical standards.
Kenwell, of eToro, downplayed the risk posed by geopolitical unrest or AI, saying potential volatility could arise from unanticipated economic developments.
“If we do see an expansion of volatility, it will be tied to the jobs market, inflation or the Fed. More likely, a combination of them,” Kenwell said.
John Canavan, a U.S. lead analyst at Oxford Economics, acknowledged a risk of elevated volatility but he forecasted an uptick in the major stock indexes over the course of this year.
“Geopolitical tensions, questions about AI return on investment — these things do have the potential to generate some more volatility over the near term,” Canavan said. “Overall, our outlook is quite positive.”