US Stocks Drop on AI Concerns
The S&P 500 fell 1.5%, the Dow lost 1.3% and the Nasdaq 100 plunged 2% on Thursday as early gains evaporated amid extended pressure from the tech sector.
Volatility in AI-exposed industries reflected rising skepticism about the scale and returns of capital expenditure for compute infrastructure, while fears that automation could disrupt established business models weighed on software and select financial names.
Apple slid 5% in its worst session since April, and Amazon, Meta, Broadcom and Palantir each dropped between 2.3% and 4.8%, while Cisco tumbled 12.3% on weak guidance. Banks also remained under pressure amid scrutiny of credit card rates. In contrast, defensive shares outperformed, with Walmart 3.8% higher, and McDonald’s gaining 2.7% after earnings, while Micron outperformed on progress in HBM4 production.
The stronger-than-expected jobs report earlier in the week continued to push back expectations for near-term Federal Reserve rate cuts ahead of Friday’s CPI release.
Source: Tradingeconomics.com
