AI Stock Selloff Spreads as Investors Question High Costs

Technology stocks continued their decline on Wall Street Friday, extending a sharp selloff driven by investor anxiety over the high costs and uncertain returns of artificial intelligence investments. The Nasdaq fell 2.6 percent and the S&P 500 dropped 1.21 percent on Thursday, with further losses recorded Friday. The market turmoil reflects concerns that expensive AI development and data center construction are heavily financed through debt, while rising long-term interest rates make borrowing costlier. Even Meta, despite reporting strong third-quarter results, saw its stock fall, as investors question whether AI earnings will materialize quickly enough to justify high valuations. Economist Sindre Heyerdahl notes that giant AI companies are competing with governments for capital amid soaring public debt. The selloff may be healthy, forcing investors to reassess whether AI usage will grow as rapidly as tech giants have bet on.