Nasdaq set to confirm correction as AI stocks tumble
SPY•The Nasdaq Composite was on track to confirm a correction as it fell 4.95%, with the S&P 500 down 3.2% and the Dow down 2.15%. The Nasdaq-100 was set to lose more than $2.2 trillion in market value as chipmakers and other AI-linked stocks tumbled.
1. Nasdaq nears correction
The Nasdaq Composite looked set to confirm a technical correction on Thursday, falling 4.95% and approaching a 10% decline from its October 6 record close. The Nasdaq-100, which had confirmed a correction on Monday, was down around 5.4% and set to shed more than $2.2 trillion in market value if losses held.
2. Chipmakers lead losses
Nvidia fell 6.4%, while the Philadelphia semiconductor index plunged nearly 11%, facing a potential $1.16 trillion wipeout. Qualcomm slid 13.5% after missing fourth-quarter smartphone chip sales estimates. Meta, Amazon and Alphabet also fell, while data-center operators, AI-focused cloud companies and related utilities and equipment suppliers saw steep losses.
3. Election and rate concerns
The selloff followed Democrats' sweeping midterm election victory, which fueled concerns about tighter AI regulation and a slowdown in data-center construction. At 11:00 a.m. ET, the Dow was down 2.15%, the S&P 500 3.20% and the Nasdaq Composite 4.95%. Investors were also focused on comments hinting at possible future rate hikes and Friday's US October payrolls report.
