New York, Feb 17, 2026, 10:08 EST — Regular session
- Microsoft slipped roughly 1.4% in morning action, recently trading close to $396.
- Worries about AI disruption and mounting rivalry in AI tools kept investors on edge.
- Looking ahead, U.S. PCE inflation figures land Feb. 20, while Nvidia posts its results Feb. 25.
Microsoft Corp slipped 1.4% to $395.78 in morning trading Tuesday, dipping under the $400 mark again as big-tech nerves persisted. The shares moved in a tight band, ranging from $395.50 up to $400.90 during the session.
This moment is key for Microsoft, a company right at the heart of an intensifying argument: can the current frenzy of artificial-intelligence investment actually pay off fast enough to support lofty valuations? Shares in Microsoft have fallen roughly 17% this year, as investors digest fresh competition from Alphabet’s new Gemini model and Anthropic’s Claude Cowork AI agent, according to Reuters.
Stocks stumbled out of the gate after the long holiday, with the Nasdaq falling at the open and the S&P 500 drifting lower, as persistent jitters over AI fallout and fresh geopolitical headlines dulled investor sentiment.
China is back in the AI spotlight. Alibaba rolled out Qwen 3.5, its latest AI model—an announcement that’s factoring into market movements, according to Stash Graham, chief investment officer at Graham Capital Wealth Management. “The Alibaba AI product is one of the variables weighing on markets today,” he said. Investing
Some strategists described the selloff as just funds moving within the market, not an exit. “AI adoption is an overall positive rather than a negative, but it would change the business models of some industries,” Jefferies economist Mohit Kumar said. Investing.com Canada
This Friday, eyes turn to the Bureau of Economic Analysis and its personal income and outlays report, set for Feb. 20. Inside: the PCE price index—the Fed’s favored inflation metric.
Still, there’s a plain risk here—if AI ends up chipping away at pricing power quicker than Wall Street is braced for, or companies keep pouring money in without a sharper payoff, investors could keep trimming the “earnings multiple” (the dollar amount paid for a dollar of earnings). And a hotter inflation print? That only ups the pressure, driving rate expectations higher.
Microsoft shares are hanging around the $400 mark, which has become a key battleground for traders. They’re watching to see if buyers show up on these pullbacks, or if everyone just stands back waiting for more clarity on AI appetite and where Microsoft sits against its rivals.
Nvidia steps up with earnings on Feb. 25, a date AI traders are already circling. Investors routinely comb through Nvidia’s outlook for signals on data-center appetite—a key tell for cloud players like Microsoft.
