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AI stock selloff drives Wall Street to steepest weekly loss since June

Tech shares slid as investors grew uneasy about borrowing that funds artificial intelligence. Cloud provider CoreWeave fell 12%, and Goldman Sachs flagged risks in debt financing.

By Standard Topic. AI-generated from the reporting listed under Coverage. Published . Updated .

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What happened

AI-focused software companies lost $260 billion in value on Friday, and the Nasdaq dropped 2.1% to end below its 200-day moving average. Chipmakers took heavier losses over the week, with the iShares Semiconductor ETF down 11.8%, Micron off 14.6%, and AMD down 13%. The latest development came from China, where chipmaker CXMT said it had made key progress on a denser memory chip design, a move that has wiped billions off the largest chip stocks.

Why it matters

The S&P 500 and Nasdaq both broke key support levels, and the Nasdaq's slide below its 200-day line marks a sharp shift in market momentum. Investors are weighing whether to sell now or wait for opportunities as fear grows.

Timeline

  1. Oct 16, 5:44 PM ET: The Nasdaq plunged 2.1% and fell below its 200-day moving average as the stock market closed the week with a software sell-off.
  2. Oct 16, 5:49 PM ET: Goldman Sachs raised alarms about debt financing, and AI-focused software shed $260 billion in value as tech momentum reversed.
  3. Oct 18, 12:39 AM ET: CXMT, a Chinese memory chipmaker, said it had made key progress on a denser memory chip design, and the news knocked billions off the world's biggest chip stocks.

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