AI stocks fall again

Technological values linked to artificial intelligence (AI) fell for the second consecutive day on Friday, October 30, 2026, as investors questioned the future profitability of hundreds of billions of dollars invested in this technology.

Major indices decline

The S&P 500 declined by 2.3 percent, the Nasdaq Composite by 3.5 percent, and Intel fell by 30.7 percent, nearing its worst day since its creation in 1972. The stock price of Nvidia, the chipmaker that has become the symbol of the AI boom, declined by 4.9 percent.

Tech giants under pressure

The previous day, Alphabet had fallen by more than 12 percent, recording its worst day in history, after spending more liquidity during the summer than in the spring. Amazon declined by 1.9 percent, after allocating 94.8 billion dollars in physical assets, mainly through investments in AI technologies.

Investor concerns grow

The AI sector has entered a phase where it must "prove itself," explains Joe Tigay, portfolio manager at Equity Armor Investments. These investor concerns echo the warnings issued by the IMF, which recently warned against a stock market crash linked to the AI bubble.

Financial risks highlighted

According to the financial institution, the massive debt of technology giants to fund their AI-dedicated data centers poses serious risks to the global economy. It highlights that while hyperscalers generate significant profits, their available cash flow is rapidly declining, as their cumulative debt exceeds 1,300 billion dollars and their off-balance-sheet commitments approach 3,000 billion.

Market instability intensifies

On Friday, October 30, 2026, amid concerns about Wall Street's enthusiasm for AI technologies that may have pushed prices to excessively high levels, the decline in technology stocks intensified. The S&P 500 fell by 2.3 percent and was poised to experience its worst day since June, as well as a third consecutive week of decline.

Broader market impact

The weakness in technology stocks pulled the Nasdaq Composite downward, with a decline of 3.5 percent at 15:05 Eastern Time, while the Dow Jones Industrial Average fell by 723 points, or 1.4 percent. The U.S. stock market is now only 3.4 percent away from its all-time high, which has increased the value of employees' 401(k) accounts, but it has become increasingly unstable just days before the midterm elections to be held on Tuesday, November 3, in the United States.

Political implications

Concerns about AI in general have already become a bipartisan concern for voters, and President Donald Trump has always used the performance of the stock market as an indicator of his own success. The Intel stock dragged the market down and is set to experience its worst day since its creation in 1972, after falling by 30.7 percent.

Corporate earnings and spending

The chipmaker published earnings forecasts for the last three months of the year that were below analysts' expectations, with CEO Lip-Bu Tan stating that the personal computer sector continued to face pressures. This decline occurred even as Intel announced for the last quarter earnings that exceeded analysts' expectations.

Amazon’s financial strain

Amazon fell by 1.9 percent after announcing summer earnings that were below analysts' expectations. What may have more concerned investors was the announcement by Amazon of a cash consumption of 42.4 billion dollars over the past 12 months, according to a metric called "free cash flow."

Alphabet’s liquidity worries

The previous day, Alphabet's stock had fallen by more than 12 percent, recording its worst day in history, and dragged the S&P 500 down after announcing to investors that it had spent more liquidity during the summer than in the spring. The company behind Google and YouTube cited similar colossal investments in AI.

Investor doubts deepen

Concerns are growing about whether these hundreds of billions of dollars will generate sufficient profits and productivity to make the investment worthwhile. Meanwhile, stocks of computer chip manufacturers and other companies benefiting from the frenzy around the construction of AI data centers are under pressure, as investors fear that high interest rates may slow down the deployment of these centers.

Nvidia’s impact

The 4.9 percent decline in Nvidia's stock price, the chipmaker that has become the symbol of the AI boom, was the main factor behind the decline in the S&P 500, more than Intel.

Cryptocurrency market shaken

In the cryptocurrency sector, meanwhile, prices fell following a hacking of the world's largest cryptocurrency exchange. The price of bitcoin fell below the 77,000 dollar mark, while it exceeded 86,000 dollars at the beginning of October.

Binance breach details

An American company specializing in blockchain analysis stated that a North Korean entity was likely behind the attack that caused the loss of more than 6 billion dollars in cryptocurrencies on Binance. Coinbase Global fell by 13.6 percent despite publishing quarterly results that exceeded analysts' expectations.

Other crypto firms affected

Strategy, which claims to hold approximately 4 percent of the total bitcoin supply, declined by 8.3 percent. The company also announced quarterly earnings that exceeded analysts' expectations, while stating that its chief financial officer would resign during the first week of November for personal reasons.

Non-tech stocks rebound

Outside the technology sector, stocks have shown more resilience, many of them rebounding after announcing summer earnings that exceeded analysts' expectations. Within the S&P 500 index, the number of stocks rising was almost equal to the number of stocks falling.

Energy sector gains

ExxonMobil rose by 1.8 percent and Chevron by 1.7 percent after these two oil giants announced summer earnings that exceeded analysts' expectations. Mondelez International rose by 4 percent after the company behind the Oreo cookies and Ritz crackers announced growth that exceeded expectations.

Consumer goods sector up

Colgate-Palmolive rose by 2.9 percent after the price increases of its products in much of the world allowed it to record revenue and profits that exceeded analysts' expectations.

Global market reactions

Expectations are high regarding the ability of American companies to generate higher profits, even though, around the world, people feel discouraged by high inflation and high fuel prices. These expectations propelled the S&P 500 to its all-time high at the beginning of the month.

Bond market shifts

In the bond market, Treasury yields fell, indicating that investors were buying U.S. government bonds in search of a safer investment. The yield on 10-year Treasury bonds fell to 4.93 percent, compared to 4.98 percent on Thursday, October 29, in the evening and more than 5.30 percent at the beginning of October.

Oil price dynamics

Bond yields fell even as oil prices rebounded, a phenomenon that usually raises yields because it aggravates inflation. The price of a barrel of Brent crude increased by 2.4 percent to 113.43 dollars. It is near the upper end of its range since the war with Iran pushed oil prices and inflation higher.

International market trends

On foreign stock markets, indices showed mixed results in Europe, after more pronounced fluctuations in Asia. The South Korean Kospi fell by 3.5 percent, as concerns about AI weighed on this highly technology-oriented market, while the Hang Seng index in Hong Kong rose by 1.5 percent.

Asia-Pacific market reactions

In Japan, the Nikkei 225 fell by 2.1 percent after the Bank of Japan decided to maintain its interest rates unchanged, following the decisions made earlier in the week of the end of October by the U.S. Federal Reserve and the European Central Bank.

Chinese market collapse

In China, the AI bubble has already burst. Amid concerns about AI demand and restrictions on Chinese exports, the STAR50 index, which includes AI and semiconductor leaders on the continent, lost 40 percent in less than four months, or about 480 billion dollars in market capitalization.

Global implications

For a fund manager based in Beijing, this collapse is the result of a frenzied speculative race, a bad omen for global markets. It remains to be seen whether these shocks signal a historically significant crash.

Bubble comparisons

According to an analyst at MacroStrategy Partnership, the AI bubble is 17 times larger than the Internet bubble at the beginning of the 2000s and four times larger than the subprime bubble. Others, however, see it as a transformation rather than a bubble, raising the fundamental question: does the AI revolution rest on solid foundations or on a financial mirage fueled by the fear of "missing the train"?