Wall Street suffered its worst session in weeks on Thursday, with the Nasdaq Composite sliding more than 2% in a broad tech rout. The sell-off, described as "unnerving" by market participants, erased billions in market value from leading chipmakers.
The downturn was triggered by renewed doubts about the pace and profitability of artificial intelligence investments. Major players like Nvidia, AMD, and Micron dragged the sector lower, with Micron taking the heaviest losses amid softening demand signals.
The S&P 500 followed the Nasdaq into negative territory, while global markets also reeled from the tech-led decline. Axios characterized the move as "AI bubble fears" sending stocks plunging, while The New York Times noted a "global sell-off driven by tech stocks."
Analysts pointed to growing jitters that elevated capital expenditures on AI infrastructure may not yield near-term returns. The rout comes after months of exuberance around generative AI, raising concerns about frothy valuations across the semiconductor ecosystem.
Some strategists argue the pullback is a healthy correction rather than a bubble burst, noting that long-term demand for AI chips remains robust. Nonetheless, uncertainty about the timing of a recovery kept buyers on the sidelines.