Nasdaq Posts Largest One-Day Drop Since June as AI Investment Payback Doubts Mount

The Nasdaq Composite fell 7.8% from its closing high and logged its worst October since March 2025, as investors questioned whether escalating AI spending by major technology companies will generate adequate returns. Intel (INTC) and Reddit (RDDT) each plunged 29% on the session, while Sandisk (SNDK) dropped 13%. The Nasdaq 100 declined 3.5%, approaching the 10% correction threshold from its recent peak. Microsoft (MSFT), Meta Platforms (META), Amazon (AMZN) and Alphabet (GOOGL) each fell 1% to 2% as their data center and AI infrastructure outlays drew scrutiny over payback timelines. Capital Economics estimates the four companies' trailing 12-month capital expenditures now exceed one-third of combined S&P 500 constituent spending, with the share likely to rise. Economist John Higgins noted that as the investment increasingly relies on external financing, investors are growing more sensitive to spending levels and funding sources. Selling spread beyond technology. Goldman Sachs (GS) fell 4% and Jefferies (JEF) dropped 6%. Gold and silver declined 3.5% and 6%, respectively, extending year-to-date losses to 10% and 31%. Funds moved into U.S. Treasuries, while oil rose 2%.