Tech selloff over AI spending doubts drags Wall Street lower
Reuters reports a steep drop in tech stocks on doubts about returns from AI spending. Nasdaq fell 2.86% while Brent rose to $117.63.
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what happened
Reuters reports that a sharp selloff in Wall Street technology shares pulled MSCI's global index down 1.5% on Friday. Investors moved into US government bonds, worried that heavy AI spending that burns through cash may not deliver adequate returns. Intel shares plunged 28.6% after results showed cash outflows and slowing demand for PCs. Amazon lost 1.4%, while Alphabet fell another 1.4% after sliding 12.6% the day before.
The S&P 500 dropped 1.82% to 7,580.07, the Nasdaq Composite lost 2.86% and the Dow Jones fell 1.09%. The PHLX semiconductor index sank more than 7%. Energy was the strongest sector, as oil climbed and Exxon Mobil and Chevron posted strong profits. Brent settled at $117.63 a barrel, up 2.4%, after a tanker was attacked in the Strait of Hormuz. Gold fell to a one-year low, silver slipped below $50 an ounce, and bitcoin lost 2.49% to $76,877.30.
why it matters
Higher energy prices and persistent inflation strengthen expectations that US interest rates will stay high, which weighs on precious metals. The 10-year Treasury yield fell to 4.931% and is on track for its biggest monthly drop in nearly three years. The market is weighing the returns from AI against the risks of a prolonged war in the Middle East.
market impact
US stocks and Nasdaq: doubts about AI returns pressure tech; oil and US government bonds gain demand
- Nasdaq pressure down — tech selloff driven by doubts about returns on AI spending
- Brent pressure up — supply risks after a tanker attack in the Strait of Hormuz
- US Treasuries pressure up — safe-haven demand as investors exit technology shares
- Gold pressure down — expectations that US rates stay high amid persistent inflation
tags
instruments
sources
- Stocks fall on AI cash burn worries while bonds rally with oil — Reuters, 30 October 2026 at 21:33 UTC
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