Stock market reacts amid concerns about artificial more than $1 trillion drop. The index fell 3.4% in early afternoon trading, on course for its worst one-day drop since mid-June.
Driving the declines were shares of Amazon, which fell 3%, and Intel, which plunged 30%. Both companies reported quarterly earnings this week that failed to reassure investors and analysts.
Amazon had already lost as much as 10% late Thursday.
The broader S&P 500 also dropped sharply, by more than 1.7%. The index’s tech sector was by far the worst performing on Friday, tumbling more than 4.1%.
As trillion-dollar tech companies raise and spend hundreds of billions of dollars to build massive data centers and develop AI models, investors have been on edge as they look for clear signs that all this spending is actually delivering returns.
<p>The last time Amazon
Google stock’s historically bad day raises fears of AI bubble popping
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Meanwhile, the sell-off in tech shares appeared to increase demand for U.S. Treasuries, which briefly sent government bond yields lower.
The big AI companies that are borrowing hundreds of billions for data center build-outs have tapped the debt markets for funds, which has in turn created more competition for capital.
As those companies increasingly offer better rates of return for lenders than the U.S. government does on bonds, Treasury yields have risen in recent months — partly to keep up with the private market.
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