Nasdaq falls 2.6 Percent as US tech stocks tumble
US tech stocks tumbled sharply on October 23, 2026, as investors questioned whether massive capital outlays on artificial intelligence are creating an unsustainable market bubble. Published On 23 Oct 2026 reported that the tech-heavy Nasdaq Composite fell 2.6 percent, marking its steepest decline since June 5, while the broader S&P 500 slid 1.21 percent.
The sell-off hit nearly all members of the “Magnificent 7” group of companies that account for more than a third of the overall market. Meta shares dropped nearly 7 percent after the Facebook parent company raised its projected capital spending for the year to a range of $135 billion to $145 billion in its latest earnings report, while net profit missed expectations. Amazon fell 4.6 percent, Nvidia dropped 4.4 percent, Tesla and Alphabet both fell 3.1 percent, and Microsoft declined 2.2 percent. Apple stood as the sole exception among the group, rising 1.2 percent.
Chipmakers Fall as Rising Energy Costs Pressure Markets
The market downturn extended far beyond mega-cap consumer internet and software firms. Chipmakers Intel and Advanced Micro Devices both fell about 8 percent, while Broadcom slid 4.3 percent. Following the session losses, the Nasdaq sat roughly 5.8 percent below its all-time high reached on October 6.
Rising commodity prices compounded the negative market sentiment. Brent crude futures climbed 4 percent on Thursday and kept rising through Friday morning, pushing the international benchmark above $114.20 a barrel, its highest level since May. Energy costs have climbed steadily since February due to the fallout from the US-Israel war on Iran.
Asian markets reacted quickly to the losses on Wall Street. Japan’s benchmark Nikkei 225 fell more than 2 percent in morning trading before recouping some ground, South Korea’s KOSPI dropped as much as 3.5 percent, and Hong Kong’s Hang Seng Index slid about 0.5 percent.
Sentiment Versus Fundamentals
Market analysts debated whether current data center and graphics processing unit expenditures represent prudent infrastructure building or a speculative frenzy reminiscent of the 2000 dot-com crash. Global AI investment is forecast by technology insights company Gartner to reach $2.7 trillion in 2026 and $3.6 trillion in 2027.
Jay Goldberg, a senior analyst at Seaport Research Partners in San Francisco, told Al Jazeera that the swings stemmed more from psychological factors than deteriorating financial realities. “In short, nothing has changed. Investors have just decided to be afraid this week,” Goldberg said. “There are legitimate concerns about the AI trade, but this level of shift in the markets is driven much more by investor sentiment than any tangible reason.”