Nasdaq drops 2.86% as Alphabet and Intel selloffs shake Wall Street
Alphabet shares plunged 12% in a single session.
The short version
- Intel collapsed 28% after issuing weak quarterly guidance.
- Most other stocks actually finished the month higher.
Wall Street finished October with a split-screen session that shook major technology shares, according to BigGo Finance. The Nasdaq Composite fell 2.86% on Friday, its worst single session in recent memory, leaving the tech-heavy index nearly 8% below its early October peak.
The S&P 500 dropped 1.8% that day to close at 7,530, its lowest level since Sept. 16. The immediate trigger was a run of quarterly reports from some of the market's most closely watched names. Alphabet, which owns Google and YouTube, saw its shares plunge 12% in a single session, erasing roughly half a trillion dollars of market value.
Amazon, the giant online retailer and cloud services provider, narrowly missed forecasts and posted a second consecutive quarter of negative operating cash flow. Intel, the storied chipmaker, collapsed 28% after issuing weak guidance, triggering a wider rout in semiconductor stocks. What unsettled investors was not the results themselves so much as what they implied about spending on artificial intelligence infrastructure.
Both Alphabet and Amazon signaled they will keep pouring capital into data centers, creating an escalating cost race. Nvidia, the chip designer powering the artificial intelligence boom, fell 4% and ceded its title as the world's most valuable company to Apple. Yet beneath the tech selloff, about 72% of S&P 500 stocks actually finished the month higher as money rotated into consumer staples, utilities, and healthcare.
If your retirement account or index fund is heavily weighted in mega-cap technology, check your exposure against the wider market.
Photo: Austin McKinley, CC BY 3.0, via Wikimedia Commons
