Nasdaq leads Wall Street lower on AI spending jitters; oil prices rebound
SPY•The Nasdaq fell 1.46%, the S&P 500 lost 0.81% and the Dow slipped 0.26% as concerns about AI spending weighed on growth stocks and oil prices rebounded. Brent crude hovered near a five-month high after Houthi attacks in Saudi Arabia raised supply concerns.
1. Technology stocks slide
The Nasdaq fell more than 1% as investors weighed the costs of AI investment and the timeline for returns after earnings from Tesla and Meta failed to ease concerns. SpaceX shares fell 3.9% and Super Micro dropped 3.4%; Tesla declined 1.9% after cutting its annual capital expenditure forecast, while Meta slipped 6.7% after introducing new non-voting shares to help fund its AI expansion.
2. Market and economic signals
At 9:41 a.m. ET, the Dow was down 0.26% at 52,716.35, the S&P 500 was 0.81% lower at 7,694.03 and the Nasdaq was down 1.46% at 26,312.94. Weekly jobless claims unexpectedly fell, supporting expectations that the Federal Reserve will leave interest rates unchanged next week. The 10-year Treasury yield fell to around 5.0378% as investors sought safety.
3. Oil and company moves
Brent crude hovered near its five-month high after more Houthi attacks in Saudi Arabia stoked fears of supply disruptions and a wider Middle East conflict. Lockheed Martin gained 9.4% after raising its annual sales and profit forecast, and Spotify rose 8.7% after forecasting fourth-quarter profit above Wall Street estimates. S&P 500 third-quarter earnings growth was forecast at 32.3%, up from 30.7% previously.
