US Tech Stocks See Sharp Falls As AI Spending Nears $1 Trillion

October 30, 2026

U.S. technology stocks plunged for a second consecutive day on Friday as investors grew increasingly concerned about the enormous cost of artificial intelligence development and whether those investments will pay off. The Nasdaq fell more than 3.5%, while Intel shares dropped as much as 30%, Reddit fell 26%, and Alphabet extended its losses after shedding more than $500 billion in market value Thursday. The BBC notes that Meta, Alphabet, Oracle, Amazon, and Microsoft have collectively committed to spending $800.6 billion on AI in 2026. From the report: Chris Low, from investment management firm FHN Financial, said the bulk of what was happening in the stock market was in reaction to some of the biggest tech players such as Amazon and Google. He told Reuters the companies were “showing some pretty significant growing pains as they aggressively pursue the AI build-out.” “The thinking is that these signs suggest that the entire sector is going to slow down.”

Kathleen Brookes, research director at trading firm XTB, said there have been many ups and downs in AI trade in recent months. “Investors have turned ruthless, punishing any signs of disappointment in [third quarter] earnings,” she said. “The AI trade has had a good run in recent years, but now investors want payback, and companies like Alphabet and Intel are in the crosshairs.” […] Brookes noted that November is typically a strong month for stocks. “If we see AI stocks continue to struggle in the coming days, it could suggest the AI trade is past its peak, and investors will be looking for a new theme to drive markets,” she said.