Nasdaq falls 2.6% as AI spending doubts hit tech stocks
The Nasdaq fell 2.6% on October 22, its worst day since June, as doubts about AI spending hit Meta, Nvidia, AMD and Intel. Big Tech reports next week.
3 min read
By the numbers
- Nasdaq Composite on October 22
- -2.6%
- S&P 500 the same day
- -1.2%
- Nasdaq's distance below its October 6 high
- 5.8%
- Amazon
- 4.6%
- Nvidia
- 4.4%
- Broadcom
- 4.3%
- Tesla
- 3.1%
- Alphabet
- 3.1%
- Microsoft
- 2.2%
US tech stocks had their worst day in more than four months on Thursday, October 22, 2026, as investors questioned whether the AI building boom will pay off. The Nasdaq Composite fell 2.6%, its steepest drop since a 4.2% fall on June 5, Al Jazeera reports. The sell-off matters because the companies hit hardest are the ones spending most on AI chips and data centers.
The S&P 500, a wider index of large US companies, fell 1.2%. That was its biggest one-day drop since a 1.5% decline on July 29. The Nasdaq ended about 5.8% below the record high it set on October 6.
Who fell, and by how much
Chipmakers and Meta led the losses. Of the "Magnificent Seven," the biggest US tech stocks, only Apple rose, according to Al Jazeera.
| Company | Move on October 22 |
|---|---|
| Intel | about -8% |
| AMD | about -8% |
| Meta | nearly -7% |
| Amazon | -4.6% |
| Nvidia | -4.4% |
| Broadcom | -4.3% |
| Tesla | -3.1% |
| Alphabet | -3.1% |
| Microsoft | -2.2% |
| Apple | +1.2% |
The seven largest tech stocks make up more than a third of the overall market, Al Jazeera notes. When they fall together, the whole index moves.
Companies tied to data centers also dropped. SiliconANGLE reports that SpaceX and CoreWeave fell sharply on Thursday over concern about heavy data center spending. CoreWeave rents out Nvidia GPU servers to AI companies; its borrowing costs were already under pressure, as Tech AI Wire reported on October 17.
What set it off
The trigger was spending, not weak sales. Meta raised its 2026 forecast for capital expenditure, money spent on buildings and equipment, to $135 billion to $145 billion. Its shares fell nearly 7%, Al Jazeera reports. Meta's third-quarter results showed that spending had already pushed its free cash flow below zero.
The worry is the size of the bills. Research firm Gartner forecasts global AI investment of $2.7 trillion in 2026 and $3.6 trillion in 2027, Al Jazeera notes. The boom has revived comparisons with the dot-com crash of 2000.
Oil added pressure. Brent crude, a global oil benchmark, rose 4% on Thursday. On Friday morning it passed $114.20 a barrel, its highest level since May.
Not everyone sees a turning point
Some analysts call the drop a mood swing. "In short, nothing has changed. Investors have just decided to be afraid this week," said Jay Goldberg, a senior analyst at Seaport Research Partners. He added that "there are legitimate concerns about the AI trade," but said the move was driven much more by investor sentiment.
Asian markets were mixed on Friday. Japan's Nikkei 225 closed down 0.3%. South Korea's KOSPI fell as much as 3.5% before closing up 0.3%, and Hong Kong's Hang Seng gained 0.7%.
SiliconANGLE adds one more strain on investor money. An expected Anthropic stock listing could pull large amounts of individual investors' cash, it says. Anthropic's draft IPO filing surfaced on October 21.
What comes next
The next test arrives within a week. Alphabet and Microsoft report earnings on Wednesday, October 28, according to SiliconANGLE. Amazon, Intel and Samsung follow on Thursday, October 29. Each will be asked the same question as Meta: how much more it plans to spend on AI, and when that spending earns money.
What this means for developers
A falling stock price does not change a cloud bill this quarter. The capex plans behind it are what matter to technology buyers. Meta's $135 billion to $145 billion range keeps it among the biggest buyers of chips and data center space. Teams renting GPUs should not expect prices to fall soon.
Watch next week's calls for spending cuts. If Alphabet, Microsoft or Amazon trim AI capex plans, expect tighter free tiers, slower new-region launches or higher prices for AI services. If they hold or raise plans, supply should keep growing.
Check your exposure to smaller AI clouds. Providers that borrow heavily to buy GPUs, such as CoreWeave, feel market swings first. If one hosts your training or inference work, keep a second provider tested and ready.
For startups raising money, an Anthropic listing and a nervous market may make investors pickier. Plan for a longer runway rather than a quick next round.
Sources
- US tech stocks tumble as investors fret over AI spending - Al Jazeera
- In AI, it's a tale of two diverging investor classes - SiliconANGLE
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