AI trade falters after disappointing tech earnings
Some investors are dialing back their expectations for US economic growth, as warning signs flashed red over the sustainability of the country’s breakneck AI buildout.
The AI trade has faltered following disappointing tech earnings, prompting investors to reassess the sustainability of the US economy's AI-driven growth. The tech-heavy Nasdaq entered correction territory on Friday, with Intel stock suffering its largest single-day selloff since the 1970s, down 29%. This decline was triggered by concerns over hyperscaler spending and disappointing earnings reports from Amazon and Google.
Meta's outlook was also revised to "negative" by S&P Global, citing high capital expenditures. Analysts are expressing "sober questions" about the AI investments driving the economy, as earnings misses suggest a potential slowdown that is not reflected in current economic data.
Brief written by urgent.news from Semafor's own syndicated text. Machine-written — may contain errors; check the original before relying on it.
