A steep sell-off in artificial intelligence and semiconductor shares weighed heavily on equity markets across the globe on Thursday, overshadowing solid corporate earnings in other sectors as crude oil prices surged to five-month highs.
The tech-heavy Nasdaq Composite dropped 2.6 percent, or 694 points, to finish at 26,008.86, CBS News and The Guardian reported. The broader S&P 500 slipped 1.2 percent to 7,663.43, marking its sharpest single-day loss since late July. In contrast, the Dow Jones Industrial Average managed a fractional gain of 11.89 points, closing at 52,867.98.
Spending Jitters Hit Tech Giants
The retreat was led by high-profile technology names that have powered market gains over the past several years. Investors expressed growing caution regarding the enormous capital expenditure and debt needed to construct data centers and secure advanced microchips, according to reports from CBS News and Al Jazeera English.
Apart from Apple, members of the megacap tech group suffered noticeable downturns. Nvidia fell 4.4 percent, exerting outsized downward pressure on index benchmarks due to its position as the most valuable publicly traded company on Wall Street. Meta Platforms sank roughly 7 percent after lifting its annual capital spending projection to between $135 billion and $145 billion, while also announcing a new stock class to help finance its investments. Even though Meta exceeded revenue projections, its quarterly profit missed expectations.
Tesla slipped 3.1 percent after reporting quarterly sales that trailed Wall Street forecasts despite higher-than-expected earnings. Semiconductor equipment supplier Lam Research plunged 11.8 percent, and cloud provider CoreWeave dropped 10.1 percent amid heightened focus on borrowing levels. Other chipmakers saw sharp pullbacks as well, with Advanced Micro Devices and Intel each shedding roughly 8 percent.
The weakness among heavyweights obscured an otherwise resilient day for many domestic companies. The Guardian reported that two out of every three stocks in the S&P 500 moved higher, buoyed by positive quarterly results from firms including Procter & Gamble, Lockheed Martin and railroad operator CSX.
Global Market Fallout and Surging Energy Prices
Global markets mirrored the volatility. In Asia, South Korea’s Kospi, Japan’s Nikkei 225 and Hong Kong’s Hang Seng index experienced sharp intraday pressure before stabilizing into Friday trading. In Europe, France’s CAC 40 dropped 1.4 percent, weighed down by rising sovereign bond yields tied to government debt worries and domestic unrest.
Adding to market anxiety, energy prices advanced as the conflict involving Iran continued to disrupt energy outlooks. Brent crude futures jumped 4 percent on Thursday and moved above $114.20 a barrel on Friday morning, reaching levels not seen since May, according to Al Jazeera English. West Texas Intermediate traded up 2.1 percent to $99.21 a barrel, CBS News reported.
Seeking shelter from the equity turbulence, investors rotated toward sovereign debt. The yield on the benchmark 10-year U.S. Treasury note dropped sharply from 5.13 percent late Wednesday to 4.97 percent, despite fresh government data showing lower unemployment benefit claims.
Market analysts remain divided over whether the downturn represents a healthy consolidation or signs of a larger pullback. Capital spending on artificial intelligence infrastructure is expected to hit $2.7 trillion in 2026, according to research firm Gartner cited by Al Jazeera English. Whether tech giants can translate those historic outlays into matching profit streams remains the central question facing investors in coming quarters.
