Tech sell-off drives US markets down by nearly $1tn after subpar earnings reports
Summary
U.S. stocks fell Friday as disappointing earnings and higher spending forecasts from major technology companies intensified concerns about returns on artificial intelligence investment. The Nasdaq Composite dropped more than 3%, while the S&P 500 fell more than 1%.Key Facts
- The Nasdaq 100 was down more than 5.8% for October, with more than $2 trillion in market value set to be erased during the month.
- Intel shares fell nearly 30% after the chipmaker forecast fourth-quarter profit below analysts’ expectations, despite reporting stronger-than-expected profit for the latest quarter.
- Amazon shares fell 1.8% after the company reported lower-than-expected summer profit and disclosed higher-than-anticipated spending.
- Alphabet shares fell more than 12% the previous day, wiping about $500 billion from its market value after it reported sharply higher AI-related spending.
- Meta Platforms, Alphabet and Amazon raised forecasts for spending as they expand AI infrastructure.
- Nvidia shares fell 3.1%, weighing heavily on the S&P 500.
- The S&P 500 was at risk of losing its October gains, despite reaching a record high earlier in the month.
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