Alphabet's historic stock plunge drags U.S. markets lower

Alphabet's stock plunged 12.6% Thursday, its worst day in over 20 years, dragging U.S. markets lower after the Google parent reported weaker-than-expected summer growth, raising doubts about its massive AI investments. The S&P 500 fell 0.3%, the Nasdaq tumbled 1.4%, and the Dow dropped 132 points. Alphabet's free cash flow declined as property and equipment purchases exceeded $51 billion, intensifying concerns about AI spending across the industry. Despite the tech giant's slump, four out of five S&P 500 stocks rose, with strong earnings from KLA Corp, Eli Lilly, Mastercard, and DoorDash, which announced a $17 billion Instacart acquisition. Treasury yields eased to 4.94% following mixed economic reports, while oil prices fell. European stocks rose after the European Central Bank held rates steady, and Christine Lagarde announced her resignation effective February. Asian markets were mixed, with Samsung Electronics dropping 4.1% despite higher profits.