Tech Selloff Hits AI Stocks as S&P 500 Falls 0.5%, Nasdaq Drops 1.3%; Cramer Urges Diversification

U.S. tech stocks slid Thursday, led by AI-linked names, as the S&P 500 fell 0.5% to 7,765.36, its second straight decline, and the Nasdaq Composite dropped 1.3% to 27,193.34. The Dow Jones Industrial Average rose 0.1% to 51,231.64, up 51 points, while the Russell 2000 edged up less than 0.1%. Nvidia (NVDA), Broadcom (AVGO) and Micron (MU) declined, weighing on the Nasdaq, as doubts grew over AI earnings prospects and returns on capital spending. A Financial Times report that OpenAI's annualized revenue may be about $2 billion lower than previously understood, partly reflecting different revenue-recognition methods between OpenAI and Anthropic, added to investor unease. CNBC commentator Jim Cramer said the session underscored the risks of concentrating portfolios in tech. About 66% of S&P 500 constituents still rose Thursday, he noted, arguing diversification across sectors and asset classes helps reduce reliance on a single theme without abandoning AI exposure.