Tech stock selloff may deepen as history shows further downside risk

The S&P 500 tech sector has entered its sixth pullback of 10% or more since 2023, with four of the six plunges ranging from 14% to 27%, according to Truist strategists. Over $1 trillion in market value was wiped out Friday as investors worried about Big Tech's cash flow. The AI trade suffered as Google, Amazon, and Meta all reported negative free cash flow, while none signaled a slowdown in AI spending. The Nasdaq 100 fell 3.4%, and the S&P 500 tech sector dropped over 4.2%. Analysts note Wall Street now demands evidence that heavy AI investment will translate into durable profits, though some argue enterprise AI buildouts remain validated despite the market turmoil.