AI Stocks Crash Again, S&P 500 and Nasdaq Post First Weekly Loss in Months

AI Stocks Crash Again, S&P 500 and Nasdaq Post First Weekly Loss in Months

U.S. stocks fell Tuesday as fears over the artificial intelligence sector wiped out gains from cheaper fuel, while both the S&P 500 and Nasdaq suffered their first weekly decline in months.

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The Dow Jones Industrial Average and the S&P 500 each fell 0.1% on Tuesday, while the tech-heavy Nasdaq Composite dropped 0.2% as investor worries about artificial intelligence outweighed the positive impact of falling fuel prices [183287]. The sell-off extended a brutal week for technology shares, with the Nasdaq on track for its biggest weekly loss in more than 12 months following weaker-than-expected earnings from major tech companies [183249].

Both the S&P 500 and the Nasdaq fell in every trading session this week, marking their first weekly decline in months and erasing recent gains that had lifted stocks to record highs [183276]. A key measure of investor fear, the Cboe Volatility Index (VIX), surged more than 20% to its highest point since early 2023 as major investors sold shares in large technology companies like Apple, Microsoft, and Nvidia [183274].

The sell-off began after Micron Technology issued a weak sales forecast, raising fresh concerns about demand in the semiconductor industry [180586]. Chip stocks tumbled again, with the Philadelphia Semiconductor Index down 0.8% as investors struggled to price in conflicting signals about global demand and supply chain stability [183248]. Investors are now turning their attention to scheduled remarks from Federal Reserve officials later this week for clues on interest rate policy [183246].

Sources

U.S. Stocks Dip as AI Worries Outweigh Cheaper Fuel #183287Nasdaq on Track for Worst Week in Over a Year #183249S&P 500 and Nasdaq Post First Weekly Loss in Months #183276Wall Street Sell-Off: Fear Gauge Hits Highest Level in Months #183274Micron Warning Hits Tech Stocks; S&P 500, Nasdaq Eye Rebound #180586Chip Stocks in Turmoil: Market Swings Signal Investor Uncertainty #183248Stock Futures Fall as Chip Stocks Tumble Again; Fed Officials to Speak #183246

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