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Wall Street sinks as Nasdaq falls over 2% on AI cost worries
Reuters • • general
Key Points:
- US stock markets fell sharply on Thursday, with the Nasdaq experiencing its largest one-day drop since June, driven by concerns over AI spending and disappointing tech earnings.
- The Philadelphia Semiconductor Index dropped 6.3%, marking its biggest daily decline since June 23, amid fears about the sustainability of tech and AI sector growth.
- Meta Platforms' stock fell 7.5% despite beating earnings estimates, due to its first cash outflow in over a decade linked to AI investments, while Tesla shares dropped 2.1% after cutting capital spending forecasts.
- Crude oil prices rose to a five-month high following new strikes by Iran-backed Houthis on Saudi targets, raising inflation worries and expectations of further Federal Reserve interest rate hikes.
- Several companies including Spotify, Procter & Gamble, Lockheed Martin, Blackstone, and Union Pacific saw stock gains after reporting strong earnings and positive forecasts, helping to offset broader market declines.
