The S&P 500 and Nasdaq Composite broke their two-week winning streaks Friday as anxiety over the artificial intelligence trade deepened. Losses in semiconductor stocks dragged on the broader market, despite a rally in Moderna.
The selloff reflects a growing impatience among investors with Big Tech's trillion-dollar AI investments. After months of exuberance, shareholders are now demanding clearer evidence of returns from the technology.
U.S. stock futures pointed to further declines as AI concerns continued to stall the tech rally. Chipmakers were particularly hard hit, though an upbeat outlook from some failed to lift the sector. The Dow ended mixed, rising slightly while the Nasdaq slipped.
Investors now face a crucial test: whether the AI-driven gains of recent quarters can be justified by earnings. If Big Tech fails to deliver concrete results, the selloff could deepen across growth stocks.
Some analysts argue the pullback is a healthy correction, noting that valuations had become stretched. But the mood remains cautious as the earnings season approaches.