The U.S. stock market faced a severe decline on Friday, with the Nasdaq Composite experiencing its largest one-day drop since June 5. This decline was driven by disappointing financial results from Intel and Amazon, which heightened concerns about the substantial costs of technology companies in the field of artificial intelligence and the time required to achieve positive returns.
Significant Index Declines
The Nasdaq fell by 2.86% to 25,437.00, while the S&P 500 also dropped by 1.82% to 7,580.07. Additionally, the Dow Jones Industrial Average decreased by 1.09% to 51,770.31.
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The Nasdaq has declined by 7.8% from its all-time high recorded on October 6. This drop occurred after the release of quarterly financial results by Intel and Amazon on Thursday, overshadowing the outlook for companies heavily investing in artificial intelligence.
Impact on Technology Companies
Intel's stock faced a 28.6% decline, and other semiconductor manufacturers also experienced severe drops. Nvidia's stock fell by 4.2%, and AMD's stock decreased by 10.9%. The semiconductor index also dropped by 7.2%, bringing its monthly losses to over 15%.
Server manufacturers like Dell and HP were also under pressure, falling by 10.8% and 9.6%, respectively.
Oliver Pursch, Senior Vice President at Wealthspire Advisors in New York, stated that this week has particularly focused on the future of artificial intelligence and its investment returns. He added that companies meeting high market expectations perform well, while those failing in this regard face severe sanctions from investors.
Despite the weakness in the market, the earnings season has generally remained positive. Of the 299 companies that reported third-quarter financial results, 82% exceeded consensus estimates.
Meanwhile, stocks related to cryptocurrencies also declined following reports of a $6.3 billion theft from Binance. Shares of Coinbase, Block, and Robinhood fell between 7.2% and 10.6%.
All three major U.S. indices declined for the week, with the S&P 500 and Nasdaq also recording monthly losses.
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