Wall Street ended October with a sharp technology sell-off as disappointing earnings and doubts about the returns on massive artificial intelligence spending rattled investors, leaving the Nasdaq with its worst month since March 2025.
According to the Associated Press, the Nasdaq fell 2.86 percent on Friday, October 30, its worst day since June, after a week in which Alphabet, Amazon and Intel all gave investors reason to question the pace of AI investment. The index fell 2 percent for the week and closed October down more than 5.8 percent for the month, according to market coverage.
Alphabet shares dropped 12.6 percent on Thursday after the company reported that AI-generated search summaries were affecting revenue from its core search advertising business, wiping more than $500 billion from its market value, according to Reuters. Alphabet expects to spend up to $205 billion on investments this year, almost entirely on AI.
Amazon shares fell after the company reported negative free cash flow over twelve months and disclosed $220 billion in investment spending this year, including AI data centres, network equipment and servers. According to Reuters, five major companies, Meta, Alphabet, Oracle, Amazon and Microsoft, have committed a combined $800 billion to AI-related spending in 2026.
Intel shares plunged about 28 percent on Friday after the company forecast fourth-quarter revenue below expectations and said weaker computer demand would continue, wiping more than $130 billion from its value, according to the AP.
The S&P 500 fell 1.82 percent on Friday, while oil prices added to the pressure, with West Texas Intermediate crude settling at $104.12 a barrel. Investors now turn to the week ahead, with Apple and Palantir reporting on November 2, the US midterm elections on November 3 and the October jobs report on November 6.
Sources: Associated Press, Reuters