Nasdaq fell 2.6%: Meta down 7%, Nvidia down 4.4%

Growing concerns about the sustainability of artificial intelligence investments dealt a sharp blow to the U.S. technology market. Nasdaq Composite fell 2.6% on Thursday, marking the index's steepest daily loss since a 4.2% decline on June 5. The broad-based S&P 500 dropped 1.21%, experiencing its largest single-day decline since July 29.

Meta lost 7% in value after its net profit fell short of expectations and it raised its capital expenditure forecast for the year to $135-145 billion. Amazon declined 4.6%, Nvidia fell 4.4%. Tesla and Alphabet each dropped 3.1%, while Microsoft lost 2.2%. Intel and Advanced Micro Devices each fell roughly 8%, and Broadcom declined 4.3%. Apple was the only name among the "Magnificent 7" to avoid losses.

Jay Goldberg, a senior analyst at San Francisco-based Seaport Research Partners, told Al Jazeera that sharp market movements could be explained more by investor psychology than fundamentals. Goldberg said "in short, nothing has changed, investors just decided to get scared this week," noting that everyone he spoke with pointed to a different reason for the decline and that it amounted to a massive wall of anxiety. Goldberg added that while there are legitimate concerns about the artificial intelligence trade, this scale of shift in markets "is being driven more by investor psychology than by any concrete reason."

The reverberations of the U.S.-Israel conflict on Iran, which has pushed oil prices higher since February, also added to the pressure. Brent crude oil futures rose 4% on Thursday, surpassing $114.20 per barrel, the highest level seen in recent months. Asian markets also opened with losses Friday morning: Japan's Nikkei 225 index started morning trading with losses exceeding 2%, while South Korea's KOSPI recorded declines reaching 3.5%. Hong Kong's Hang Seng Index fell roughly 0.5%.

The massive investments U.S. technology companies are making in artificial intelligence have intensified debates over whether a market bubble similar to the 2000 dot-com bubble is forming. According to technology research firm Gartner, global artificial intelligence investments are projected to reach $2.7 trillion in 2026 and $3.6 trillion in 2027.