U.S. stocks fell Thursday as concerns over AI spending weighed on technology shares: the Nasdaq dropped 2.68%, the S&P 500 lost 1.41% and the Dow fell 0.20%. The semiconductor index slid 6.3%, while crude prices reached a five-month high.
The Nasdaq posted its steepest daily decline since early June, falling 2.68% as investors questioned the scale of spending on artificial intelligence. The Philadelphia Semiconductor Index fell 6.3%, its largest one-day drop since June 23, and was down more than 26% from its June 22 record close, while remaining up 52.2% for the year.
Meta Platforms shares fell 7.5% after the company reported its first cash outflow in more than a decade due to AI-related spending and announced plans for a two-for-one split of non-voting shares to raise capital. Tesla lost 2.1% despite positive quarterly free cash flow and lower 2026 capital spending plans. Among other earnings movers, Spotify rose 10.7%, Procter & Gamble gained 6.0%, Lockheed Martin advanced 6.1%, Blackstone rose 6.6% and Union Pacific gained 2.9%.
Crude prices touched a five-month high after new strikes against Saudi targets, while investors weighed the risk that inflation could keep interest rates elevated. Initial claims for unemployment benefits remained near multi-decade lows. Of the 111 S&P 500 companies that had reported third-quarter results, 83% beat analyst expectations, based on the latest LSEG data.
