Nasdaq drops 2.6% on AI spending fears; oil hits five-month high

U.S. stocks fell Thursday as renewed concerns over artificial intelligence spending pressured technology shares, while escalating Middle East tensions pushed oil prices to a five-month high. The Nasdaq Composite posted its sharpest daily decline since June, and the S&P 500 had its worst session since July. The Nasdaq dropped 2.60% to 26,008.86, and the S&P 500 lost 1.21% to 7,663.43, while the Dow Jones Industrial Average edged up 0.02% to 52,867.98. Tech stocks led losses, with Meta Platforms falling about 7%, AMD over 8%, Micron 6%, and Nvidia 4%. Brent crude rose 3% to $113.03 per barrel, and Treasury yields fell as investors sought safe havens. Rising oil prices stoked inflation worries, and investors weighed the possibility of another Federal Reserve rate hike. Treasury yields dropped over 16 basis points, with the 10-year at 4.974%. Of 111 S&P 500 companies reporting results, 83% beat analyst expectations, though mixed earnings signals persisted.