Technology losses dominate Wall Street
A sharp decline in artificial intelligence stocks pulled markets lower worldwide on Thursday. The S&P 500 fell 1.2% for its worst day since July, while the Nasdaq composite dropped 2.6%. However, the Dow Jones Industrial Average gained 11 points because most stocks outside the technology sector advanced.
Investors remained concerned about expensive borrowing for data centers and AI chips, as well as elevated technology valuations. Lam Research sank 11.8% despite reporting stronger summer profit and revenue than analysts expected. Meta Platforms lost 7%, Nvidia declined 4.4%, Tesla fell 3.1% and CoreWeave dropped 10.1%. Nvidia exerted the greatest downward pressure because it is Wall Street’s largest company by market value.
Oil and overseas markets add pressure
Technology weakness began in Asia, where many major indexes include large companies tied to the industry. South Korea’s Kospi tumbled 3.5%, Hong Kong’s Hang Seng lost 3% and Japan’s Nikkei 225 fell 2.7%. Meanwhile, France’s CAC 40 declined 1.4% as higher government bond yields added pressure.
Brent crude jumped 4% to $113.17 per barrel after reaching its highest level in five months. The price had stood below $97 at the beginning of October. Uncertainty surrounding the war with Iran continued to disrupt expectations for a return to normal conditions in the global energy industry.
Bonds and broader earnings soften the fall
Government debt and high inflation have recently pushed bond yields upward across developed economies. Nevertheless, investors sought safety in United States government bonds as AI shares fell. The 10-year Treasury yield dropped to 4.97% from 5.13% late Wednesday and more than 5.30% earlier in October.
Economic data showed fewer American workers applied for unemployment benefits during the previous week. In addition, two-thirds of the companies in the S&P 500 rose despite the index’s overall decline. Strong earnings from Procter & Gamble, Lockheed Martin and CSX helped limit losses. Procter & Gamble gained 5.6% after maintaining its full-year forecasts despite continuing geopolitical and economic challenges.
References
Choe, S. (2026, October 22). Sharp drops for AI stocks overwhelm markets worldwide as oil prices jump. AP News. https://apnews.com/article/stocks-markets-rates-earnings-oil-33767691a4a0730b96d6f0c5100ea9b2