AI summary
Summary of article:
The prospect of returns on AI capital expenditure has created skepticism in the market. US technology stocks fell, Intel fell 29%, and semiconductor and cloud concept stocks also fell together.
On the 30th, US stocks fell, technology stocks fell, and the market value dropped by more than 1 trillion yuan.stamp 500 The index (S&P 500) fell 1.8%,Nasdaq 100 index (Nasdaq 100) suffered its biggest one-day decline since June.
The Nasdaq 100 fell 3.4% in afternoon trading, NBC News reported. The current selloff has pushed the Nasdaq 100 into so-called “correction territory,” a decline of 10% or more from its previous all-time high. The S&P 500 index also fell 1.8%, with the technology sector performing the worst, falling more than 4.2%.
As multi-trillion-dollar technology giants spend hundreds of billions of dollars building artificial intelligence (AI) data centers, investors are looking for clear signs that these big expenditures are actually yielding reciprocal returns. Those concerns hit Intel, one of the worst-performing stocks of the day, as its shares fell 29%, its biggest one-day decline since records began in the 1980s.
Other colleagues have also followed suit. SanDisk fell 13%, and chip giants AMD, ARM Holdings, Qualcomm and Marvell all fell about 10%. The Philadelphia Semiconductor Index fell 7.2%, and the DRAM ETF, which tracks the memory and storage industry, fell 7%. Emerging cloud NeoCloud was sold off, with Nebius and CoreWave both falling more than 10%. The Nasdaq Composite, which tracks more than 3,000 listed companies, fell 2.8%.
The seeds of this fall were sown as early as the 29th. Amazon reported a boost in AI spending last quarter, but growth slowed in its core online shopping business. CEO Andy Jassy said capital spending in 2026 is expected to be about 220 billion yuan, most of which will be used for Amazon Web Services (AWS), and spending in 2027 will be more significant. Although Amazon’s stock price fell 10% after the market closed on the 29th, the closing decline on the 30th was reduced to 1.4%. However, the market value of Google’s parent company Alphabet decreased by nearly 500 billion yuan on the 29th, which was the worst day in the company’s history. The stock price fell 1.4% on the 30th.
Intel warned that fourth-quarter profits and sales will be lower than expected. Although it has recently benefited from management reforms and the US government has become the largest shareholder, increasing the value of the government’s shareholding by 280%, supply chain difficulties still badly hit performance. Citigroup analysts described its earnings report as “two steps forward, one step back.” Intel CEO Lip-Bu Tan acknowledged that the company faces challenges such as manufacturing shortages, memory shortages and weak demand for personal computers (PCs).
Summary FAQ
-
The market is focused on whether huge spending on AI data centers and cloud infrastructure can bring relative returns. Investors have obvious doubts about the pace of “cash burn” and the ability to convert profits, resulting in a widespread selloff in technology stocks.
-
Intel not only warned that fourth-quarter profits and sales would be lower than expected, but also faced problems such as manufacturing shortages, tight memory and weak PC demand. The financial report simultaneously eclipsed performance and prospects, sending the stock price down 29%.
-
Apart from Intel, chip stocks like SanDisk, AMD, ARM, Qualcomm and Marvell declined significantly. The Philadelphia Semiconductor Index fell 7.2%, and the Nasdaq 100 and Nasdaq Composite Index also weakened together.
