Tech stocks tumble as AI spending raises investor concerns

The S&P 500 slipped 1.8% on Friday, marking the third consecutive week of declines, while the Nasdaq composite fell 2.8%, extending a sharp October slide that erased more than $2.84 trillion in market value from the Nasdaq 100. Investors cited growing unease about the high costs of building artificial-intelligence infrastructure, which have not yet translated into proportional profits for many large firms. Alphabet, the parent of Google, recorded a loss of over a trillion dollars in market value this month, and other major tech companies such as Nvidia, Meta, SpaceX and Amazon also posted sizable declines. Reddit experienced its steepest single-day drop, losing more than 25% of its value, partly because AI-generated overviews have reduced its search referral traffic.

The broader market showed mixed performance, with oil producers Chevron and ExxonMobil posting gains, as did consumer-goods company Colgate-Palmolive. Meanwhile, Bitcoin fell sharply after a major hack at the Binance exchange, in which hackers reportedly stole $8.9 billion, an incident attributed to North Korean actors. The market downturn coincides with the upcoming midterm elections, during which President Donald Trump has highlighted stock-market performance as an indicator of his administration’s success.