Nasdaq hits three-month low as Amazon and Intel rattle AI trade

The Nasdaq fell 2.48% to a near three-month low on Friday as Amazon's rising AI spending and Intel's cash-burn warning triggered a tech selloff, with the two companies facing nearly $200 billion in combined market value losses. Amazon dropped 2% after reporting a sharp third-quarter cash outflow and signaling higher capital expenditure next year, while Intel slid nearly 29% on record after warning it would burn cash due to a weak PC market and manufacturing hurdles. The warning hit global chip stocks, with Nvidia down 3.7%, AMD sliding about 10%, and the broader chips index shedding 7%. The Nasdaq-100 was set to erase over $1 trillion on Friday. Investors rotated into defensive sectors like consumer staples and healthcare, which rose 1.6% and 0.7%, respectively, while energy stocks gained on Chevron and Exxon Mobil earnings beats. The Federal Reserve is expected to hike rates by over 50 basis points by mid-2027, potentially complicating debt-funded AI spending. Reddit plunged 28% after warning of a possible double-digit drop in daily active users.