Stock Market Summary – February 26, 2026

The S&P 500 fell due to weakness in semiconductor stocks, with leading AI chipmaker Nvidia dropping 4% despite a strong quarter. Software stocks like Salesforce saw increases of nearly 4%, while banks such as Capital One and Goldman Sachs also advanced. Jim Cramer of CNBC suggested that Nvidia’s drop wasn’t a reflection of the company’s performance, but a result of a rotation away from chip stocks into areas like software.

In other news, US mortgage rates fell below 6% for the first time since 2022, potentially encouraging more consumers to enter the housing market. Despite home prices rising approximately 50% since 2020, lower mortgage rates have improved buying power, with the median-income US household now able to afford a $331,483 home, an increase in buying power of over $30,000 since last year.

In AI developments, Google launched Nano Banana 2, an update to its AI image generator. The new model features increased speed and more accurate renderings. AI image and video generators have surged in popularity, allowing users to create advanced graphics and videos with a few text prompts. However, concerns about copyright infringement have also grown with the proliferation of these tools.

In job market news, eBay announced it is cutting about 800 roles or 6% of its workforce, and C3 AI announced cuts to over a quarter of its workforce following disappointing third-quarter fiscal results.

Regarding politics, Congressional Democrats plan to force a vote on a war powers resolution relating to Iran next week, with the aim of limiting President Donald Trump’s ability to conduct military action in the region. This announcement comes as President Donald Trump fares a massive military buildup in the region.

Lastly, “The Big Short” investor Michael Burry raised red flags on Nvidia’s latest earnings report, pointing to a surge in the chipmaker’s purchase obligations which increased to $95.2 billion from $16.1 billion a year earlier. Burry sees this as a potential sign of overcommitment to supply, comparing it to Cisco’s situation during the height of the dot-com bubble.