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Tech sell-off drives US markets down by nearly $1tn after subpar earnings reports

A sell-off of tech stocks that began earlier this month and gained steam with disappointing earnings from leading tech companies drove US markets down by hundreds of billions of dollars Friday. In total, the decline has knocked nearly $1tn in value off the tech-heavy Nasdaq exchange in one week and erased about $2tn in a month. The S&P 500, the index of the 500 most valuable companies in the US, fell by more than 1% Friday, losing hundreds of billions of dollars in market value. It was on track to erase its…

By the Truvace desk2 min read1 sourceEvidence: Emerging · 42/100 — News report · 1 independent sourceJournalismTRV-2026-2334· cite & verify
Tech sell-off drives US markets down by nearly $1tn after subpar earnings reports

In brief

A tech-led sell-off deepened on a Friday after disappointing earnings from major companies, taking nearly $1tn off the Nasdaq in a week and about $2tn in a month. The Nasdaq composite fell more than 3% and the S&P 500 more than 1%.

The episode shows markets are testing whether AI capital spending can pay back soon. What remains uncertain is whether the losses reflect a lasting reassessment of AI returns or a reaction to company-specific results and interest rate worries.

Main points

  1. Alphabet fell more than 12% the day before, wiping $500bn from its market value, its worst day on record.
  2. Meta, Alphabet and Amazon raised spending forecasts further as they expand AI infrastructure.
  3. Intel tumbled nearly 30% after giving a profit forecast far below analyst expectations.
  4. Nvidia fell 3.1%, the heaviest drag on the S&P 500, amid concern that high interest rates may slow data center build-out.

The problem

Investor doubts about whether huge AI spending will yield profits quickly enough helped drive about $2tn off the Nasdaq 100 in October and sharp single-day drops at Alphabet and Intel.

The rundown

The Nasdaq 100 fell more than 5.8% in October as the AI trade met turbulence, with more than $2tn in market value set to be wiped out. The article notes this is slightly more than SpaceX's entire market value.

Alphabet said it burned through more cash in the summer than the spring because of massive AI investments. Amazon fell 1.8% after reporting weaker profit than analysts expected and spending more than anticipated.

Chip companies and other beneficiaries of data center construction also came under pressure on worries that high interest rates may slow the build-out, while the rest of Wall Street was mixed.

Sources

  1. JournalismThe Guardian2026-10-30

The debate