Financial Markets                      10/30 15:26

   

   NEW YORK (AP) -- A sell-off for tech stocks got even worse Friday on worries 
that Wall Street's frenzy around artificial-intelligence technology sent prices 
too high.

   The S&P 500 tumbled 1.8% for its worst day since June, and it closed out a 
third straight losing week. The weakness for technology stocks dragged the 
NASDAQ composite down a market-leading 2.9%, while the Dow Jones Industrial 
Average dropped 572 points, or 1.1%.

   The U.S. stock market remains only 3.1% below its all-time high, which has 
boosted the value of workers' 401(k) accounts, but it's become increasingly 
shaky as Tuesday's midterm elections in the United States approach. Worries 
about AI in general have already become a concern for voters across political 
parties, and President Donald Trump has historically used the stock market's 
performance as a measure of his own success.

   Intel's stock led the way lower and plunged 28.6% for its worst drop since 
1974. The chipmaker gave a forecast for profit in the final three months of 
this year that fell short of analysts' expectations, as CEO Lip-Bu Tan said the 
personal-computer industry continues to feel pressure. The drop came even 
though Intel reported a stronger profit for the latest quarter than analysts 
expected.

   Amazon fell 1.4% after reporting a weaker profit for the summer than 
analysts expected. Potentially more concerning for investors was Amazon's 
reporting that it burned through $42.4 billion of cash over the prior 12 
months, according to a measure called free cash flow. It spent $94.8 billion on 
property and equipment, primarily through investments in 
artificial-intelligence technology.

   A day earlier, Alphabet's stock dropped more than 12% to its worst day on 
record and dragged the S&P 500 down after telling investors it burned through 
more cash during the summer than the spring. The company behind Google and 
YouTube cited similar, mammoth investments in AI.

   Worries are rising about whether all the hundreds of billions of dollars 
will produce enough profit and productivity to make the investment worth it. At 
the same time, stocks of computer chip companies and other winners from the 
frenzy to build AI data centers have come under pressure on concerns that high 
interest rates may slow the further build out of data centers.

   "We're moving out of the hopes and dreams phase of the AI trade and into the 
'show me' phase," said Joe Tigay, portfolio manager at Equity Armor 
Investments, in a note to investors.

   A drop of 4.2% for Nvidia, the chip company that became the poster child of 
the AI frenzy, was the heaviest force pulling the S&P 500 downward, outweighing 
even Intel.

   In the cryptocurrency industry, meanwhile, stocks tumbled following a hack 
on the world's biggest crypto exchange. The price of bitcoin fell below $77,000 
from more than $86,000 earlier this month, and a U.S.-based blockchain 
intelligence firm said a North Korean unit was likely behind the attack that 
impacted more than $6 billion worth of crypto at Binance.

   Coinbase Global fell 10.6% even though it reported stronger results for the 
latest quarter than analysts expected. Strategy, which says it owns about 4% of 
the total supply of bitcoin, fell 7.8%. It also reported a stronger profit for 
the latest quarter than analysts expected, while saying its chief financial 
officer will resign next week for personal reasons.

   Outside of tech, stocks were more resilient as many rallied after reporting 
stronger profits for the summer than analysts expected. Nearly as many stocks 
rose within the S&P 500 index rose as fell.

   ExxonMobil climbed 2.2%, and Chevron added 1.8% after the oil giants 
reported stronger profit for the summer than analysts expected.

   Mondelez International rose 3.9% after the company behind Oreo cookies and 
Ritz crackers reported stronger-than-expected growth.

   Colgate-Palmolive climbed 2.3% after higher prices for its products around 
much of the world helped it deliver better revenue and profit than analysts 
expected.

   Expectations are high for U.S. companies' ability to make bigger profits, 
even though people around the world are feeling discouraged about high 
inflation and high fuel prices. Such expectations are what drove the S&P 500 to 
its record earlier this month.

   All told, the S&P 500 fell 140.32 points to 7,580.07. The Dow Jones 
Industrial Average dropped 572.25 to 51,770.31, and the Nasdaq composite sank 
747.73 to 25,437.00.

   In the bond market, Treasury yields eased in a signal that investors were 
buying U.S. government bonds in search of something safer to own. The yield on 
the 10-year Treasury fell to 4.93% from 4.98% late Thursday and from more than 
5.30% earlier in the month.

   Treasury yields fell even though oil prices bounced higher, something that 
usually drives yields upward because it worsens inflation. The price for a 
barrel of Brent crude oil rose 2.4% to $113.43. It's near the high end of its 
range since the war with Iran sent oil prices and inflation higher.

   In stock markets abroad, indexes were mixed in Europe following sharper 
swings in Asia.

   South Korea's Kospi dropped 3.5% as worries about AI hit its tech-heavy 
market, while the Hang Seng in Hong Kong climbed 1.5%.

   Japan's Nikkei 225 fell 2.1% after the Bank of Japan decided to keep 
interest rates steady, echoing moves made earlier in the week by the Federal 
Reserve and the European Central Bank.

   ___

   AP Business Writers Yuri Kageyama and Michelle Chapman contributed to this 
report.

   ---------

   itemid:16c266731fdf64178f38070af2b42497




(c) Copyright 2026 DTN, LLC. All rights reserved.