Wall Street slides as AI funding fears and SpaceX telecom bet rattle stocks
The Dow Jones Industrial Average shed 747.49 points (1.41%) to close at 52,332.44, as renewed unease over AI spending and news of a potential SpaceX wireless venture pressured technology and telecom shares.
The S&P 500 edged down 0.38% to settle at 7,634.09, and the Nasdaq Composite eased a slight 0.08%, closing at 25,986.76. Both gauges touched five-week troughs as investors continued to question the scale and funding structure of artificial intelligence spending.
Volatility in AI-related names has been pronounced throughout the month. Worries first surfaced around CoreWeave’s borrowing levels and the expense of bankrolling AI expansion plans. Stocks briefly rallied midweek after SpaceX and Super Micro posted upbeat earnings, but that bounce faded quickly when the Nasdaq tumbled roughly 3% the following session.
The selloff gathered pace once Meta’s shares sank nearly 8% after the company reported its first period of negative cash flow in more than a decade, a result it linked to substantial AI-related expenditures. Meta shares declined an additional 1.3% on Friday, whereas CoreWeave managed a modest 0.3% gain.
Kim Forrest, who serves as chief investment officer at Bokeh Capital Partners, suggested the recent drop appeared excessive given the near-term outlook, arguing that markets had misjudged just how extended the current AI investment phase would prove to be.
Telecommunications stocks also came under pressure amid reports that SpaceX was holding discussions with infrastructure firms about building a nationwide wireless network. Shares of AT&T, Verizon and T-Mobile slid by 3% to 4.7%, pulling the S&P 500’s communication services sub-index lower by 1%. Tower companies moved the opposite way, with Crown Castle climbing 12.6% and American Tower gaining 6.9%.
Energy stocks stood out as a bright spot, with the sector’s S&P 500 index climbing to a fresh record as crude prices advanced. Brent crude traded close to its strongest level in over five months amid persistent Middle East supply disruptions, feeding inflation concerns just days before the Federal Reserve’s upcoming policy meeting.
For markets Praevis tracks, this Dow Jones AI selloff could weigh further on the Nasdaq 100 and broader US benchmarks, while telecom disruption fears add extra index-level swings; stronger oil prices, meanwhile, favor energy-linked equities and keep inflation expectations—and Fed rate-path pricing—in sharp focus for the dollar and Treasury markets.
Source: Economic Times Markets