The Nasdaq Composite fell as renewed worries about AI spending hit tech shares, while oil prices rose on Iran tensions. Meta, AMD and CoreWeave fell, and Treasury yields dropped as investors sought shelter.
The Nasdaq Composite pulled back 2.1% as concerns about spending by artificial intelligence companies returned. The S&P 500 shed 1.3%, and the Dow Jones Industrial Average dropped 279 points, or 0.5%.
Meta, AMD and Micron fall with the Nasdaq
Meta Platforms slipped 5% even though it exceeded revenue expectations and offered upbeat guidance. Wells Fargo traders said Meta's comments about the large amount of AI funding needed caused the shares to roll over and weighed on the overall market.
Advanced Micro Devices fell more than 5%, while Micron Technology and Nvidia dropped 2% and 1%, respectively.
Huang flags scarce capital for neoclouds
CoreWeave declined nearly 4%, and its bond yields and credit default swaps remain elevated. Nvidia CEO Jensen Huang told CNBC that demand for neoclouds is very strong. He added that capital is scarce and impeding growth.
According to CNBC, Huang said: “There’s a scarcity of capital.” Wells Fargo traders said that commentary is spooking markets and reigniting concerns about credit markets being full from a risk appetite standpoint.
Oil jumps on reports of Iran strike plans
Oil prices rose after The New York Times reported, citing sources, that the U.S. and Israel have plans for renewed strikes against Iran after next month's midterm elections. President Donald Trump also told reporters that Washington is not negotiating with Tehran and that something will happen fairly soon.
Brent crude futures traded 3% higher at above $112.45 per barrel, and West Texas Intermediate futures advanced 2% to above $99.95.
Investors also turned to Treasurys as a safe haven. The 10-year yield dropped more than 9 basis points to 5.048%.
Source: CNBC
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