Nasdaq Slides as AI Spending Concerns Trigger Global Tech Rout

US technology stocks suffered heavy losses on Thursday as concerns over escalating artificial intelligence spending triggered a broad market sell-off. The Nasdaq Composite plunged 2.60%, marking its steepest one-day fall in months, while the S&P 500 dropped 1.21%.

Chipmakers led the decline, with Advanced Micro Devices (AMD) tumbling more than 8%, while Micron Technology and Nvidia fell 6% and 4% respectively. Investors questioned whether massive capital expenditure commitments across the technology sector would generate sufficient returns.

Nasdaq Slides

The sell-off spread globally, weighing on Asian and European markets, particularly technology-heavy indices. Despite posting stronger-than-expected results, major technology companies failed to reassure investors that increased AI investments would deliver near-term profitability.

Meanwhile, geopolitical tensions involving Iran pushed Brent crude oil prices above US$112 per barrel, adding another layer of uncertainty to financial markets. Investors responded by shifting toward safer assets, driving the US 10-year Treasury yield below the 5% level.

Market participants are now turning their attention to next week’s US Federal Reserve meeting for guidance on the interest rate outlook amid heightened market volatility and growing concerns surrounding global economic growth.

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