Optencis
US technology shares sold off on Thursday 22 October 2026, with the Nasdaq 100 closing 2.90% lower at 28,958.69. Earnings from Meta and Tesla did not give investors the support they wanted for AI-related stocks, while the Dow Jones Industrial Average ended almost unchanged.
What happened
Bloomberg reported that stocks fell after results from Meta and Tesla failed to support the AI trade, the group of shares linked to artificial intelligence that has driven much of the market's gains. Reuters described the heavy cost of building AI infrastructure as a burden on Meta and other popular tech names. Meta lost about 7% during the session, according to investingLive. Bloomberg also noted that Meta has disclosed commitments worth roughly $825 billion in leases and contracts, many of them tied to computing power and AI infrastructure.
The figures
The broader Nasdaq Composite fell 2.60% to 26,008.86, its worst day since 5 June according to investingLive. The S&P 500 lost 1.21% to 7,663.43. In contrast, the Dow added 0.02% to 52,873.28 and the small-cap Russell 2000 gained 0.11% to 2,784.03. Apple was the exception among the largest tech names, closing up 1.23%, while weakness in chip stocks added to the pressure on the Nasdaq indices.
- 1AI spending scrutinyInvestors question returns on investment
- 2Tech shares fallNasdaq 100 down 2.90%
- 3Demand for safetyBuying of US Treasuries
- 4Yields drop10-year falls below 5%
Why the AI bill worries investors
The main question for investors is whether the very large sums being spent on AI will bring returns big enough to justify them. When a company commits hundreds of billions of dollars to data centres and computing contracts, the market looks closely at when that money might pay off. Because a handful of tech giants carry a large weight in the Nasdaq 100, a drop in those shares can move the whole index, even when other parts of the market hold steady. The small gains in the Dow and the Russell 2000 suggest some money moved to other sectors rather than leaving stocks entirely.
Investors need a clearer sense of where tech companies' capital spending estimates will finally settle.
Views reported by the sources, not Optencis opinions.
Bonds, the dollar and the Fed
US government bonds attracted strong buying. The 10-year Treasury yield fell 18.5 basis points to about 4.96%, down from 5.36% reached last week, and the 2-year yield dropped 17.1 basis points. Lower yields would usually help growth stocks, but that support did not show up on Thursday, as oil prices rose on Iran-related risks and kept inflation concerns alive. The US dollar ended mixed, with USD/JPY down 0.82% at 156.83. Futures pricing gave a 22% probability that the US Federal Reserve (Fed) will not raise rates again this year, which means markets still see another hike as more likely, but a pause is getting more attention.
Sources: Bloomberg, Reuters, investingLive.
