AI stock selloff drags global indexes lower as Brent reaches $113.17

Two-thirds of S&P 500 stocks rise as Treasuries draw buyers

The selloff was concentrated in heavily weighted technology shares rather than a uniform decline across the U.S. market. The S&P 500 fell 1.2% for its worst session since July and the Nasdaq composite tumbled 2.6%, while the Dow Jones Industrial Average added 11 points, or less than 0.1%. Two-thirds of the S&P 500’s stocks rose, but declines in Nvidia and other influential technology issues outweighed those gains at the index level. Nvidia dropped 4.4%; because it was the largest company on Wall Street by total market value, its decline was the single strongest force pulling the S&P 500 lower.

Trading in AI-related stocks had swung on two concerns: the boom could be under threat because money had become expensive to borrow for datacenters and more AI chips, and prices had risen too high after a years-long frenzy. Companies in the industry continued to report growth, but that did not prevent the selloff.

Quarterly results showed a pronounced disconnect between operating performance and share prices. Lam Research, whose equipment and services help make semiconductors, reported summer gains in profit and revenue that were slightly stronger than analysts expected. Its stock nevertheless tumbled 11.8%.

Meta Platforms, the company behind Facebook and Instagram, was also pushing its Muse AI agent. It lost 7% and shed tens of billions in market value after reporting quarterly revenue stronger than analysts expected, though its profit fell short. The company said it was creating a new class of stock to raise money for AI investments and other expenses. Tesla fell 3.1% after reporting stronger summer profit than analysts expected but weaker-than-forecast revenue.

CoreWeave, which has borrowed money to buy Nvidia’s AI chips that it rents to cloud customers, dropped 10.1%. Worries about the company’s debt had made it particularly shaky in recent weeks.

The weakness in AI and other technology shares began in Asia, where indexes are full of industry players. South Korea’s Kospi tumbled 3.5%, Hong Kong’s Hang Seng dropped 3% and Japan’s Nikkei 225 sank 2.7%.

Oil added separate pressure on global stock markets. Brent crude rose 4% to $113.17 a barrel after touching its highest level in five months, up from less than $97 at the start of the month. The increase reflected uncertainty about when the war with Iran would allow the global energy industry to return to normal.

In Europe, France’s CAC 40 fell 1.4%, one of the continent’s sharpest losses. The index has fewer technology stocks than Asian or U.S. benchmarks, but it was hurt by a jump in French government bond yields. Those yields had been climbing because of worries about the government’s large debt load and strained budget. Violent protests across France raised pressure on the government to increase spending, which could add further to the debt.

Worries about large government debts were weighing on almost every developed economy, including the United States. Such concerns, along with high inflation, signals of a still-strong U.S. economy and other factors, had pushed U.S. bond yields recently to their highest levels in decades. But U.S. yields nevertheless fell sharply Thursday as investors bought U.S. government bonds in search of something safer to own while AI stocks tumbled.

The 10-year Treasury yield tumbled to 4.97% from 5.13% late Wednesday, after having exceeded 5.30% earlier in the month. The Guardian described that as a major move for the bond market. Separately, FRED’s raw DGS10 daily series listed the 10-year Treasury yield at 5.13% as of Oct. 22, 2026.

Thursday’s drop in yields came even as another report suggested the U.S. economy might be doing better than economists expected. It said fewer U.S. workers applied for unemployment benefits last week, which could signal that layoffs remained low across the country. The stronger economy had helped companies broadly post bigger profits and helped the U.S. stock market reach a record high earlier in the month despite competing concerns.

Procter & Gamble, Lockheed Martin and CSX were among the latest companies topping profit expectations for the summer, and gains in their shares helped limit the market’s losses. Procter & Gamble CEO Shailesh Jejurikar said the company expects “geopolitical and economic challenges” to continue, but it stood by its full-year growth forecasts for revenue, profit and other measures. The company behind the Crest, Olay and Oral-B brands rose 5.6%.

All told, the S&P 500 fell 93.74 points to 7,663.43, the Dow added 11.89 points to 52,867.98 and the Nasdaq composite lost 694.00 points to 26,008.86. Broad gains outside AI-related stocks kept the Dow nearly unchanged, but losses in Nvidia and other influential technology issues outweighed them at the index level.

MSI previously reported that falling AI stocks, higher oil and rising Treasury yields pulled Wall Street off record highs in May, and also reported a June selloff across Asian and U.S. markets amid the Iran conflict and AI-spending fears. Oct. 22 again brought worldwide AI-stock weakness and higher oil, but the bond-market response differed: Treasury yields fell sharply as investors sought safer assets.