Tech Stocks Selloff: Why AI Shares Are Crashing

Technology stocks plunged sharply on Thursday, with the Nasdaq 100 falling 6.4 percent to 26,629 points, erasing $2.3 trillion in market value. The selloff hit AI and chip companies hardest, including Nvidia dropping 9.3 percent and memory makers like Seagate falling up to 22 percent. The decline was driven by multiple factors, including fears of stricter regulation of data centers following Democratic gains in the US midterm elections. Disappointing quarterly results from companies like Qualcomm, which reported lower revenue and profit, also fueled investor skepticism about the AI sector. Broader concerns include doubts about whether massive AI infrastructure investments will pay off quickly, as well as expectations that the Federal Reserve may raise interest rates in December. The selloff extended to Asian markets on Friday, with the S&P 500 falling 4.4 percent.