In brief
U.S. stock indices closed lower on Thursday, with the Nasdaq dropping more than 1%, while the Dow and S&P 500 slipped about a quarter of a percent. The decline was driven largely by Alphabet’s steep 12-plus percent fall after a revenue miss that reignited worries about the cost of artificial intelligence investments. Other technology names and some industrials saw losses, although oil prices settled lower on hopes of a U.S.-Iran truce.
On Thursday, the New York Stock Exchange and Nasdaq exchanged feelings of unease as major indices slipped at the close. The Nasdaq Composite fell 365.13 points, or 1.38 percent, to 26,184.72, the Dow Jones Industrial Average dropped 132.54 points, or 0.25 percent, to 52,342.56, and the S&P 500 slipped 23.59 points, or 0.30 percent, to 7,720.39, according to Xinhua and WAM.
Both outlets pointed to Alphabet’s dramatic plunge, which fell more than 12 percent after the company reported third‑quarter revenue of 127.58 billion dollars—up 25 percent year on year but below market expectations. The company’s net income fell to 26.17 billion dollars and free cash flow turned negative at 9.07 billion dollars, creating a spate of alarm about the high cost of artificial intelligence investment.
WAM noted that the weakness came amid a general sell‑off in technology shares, with Microsoft edged lower despite a 48 percent jump in Azure cloud growth and Caterpillar falling over 9 percent, dragging the Dow. ServiceNow crashed about 27 percent and Marvell lost 13 percent, further weighing on technology sector sentiment.
Eli Lilly, in contrast, added more than 6 percent after lifting its revenue outlook, while Amazon and Intel faltered ahead of their earnings releases after the close, adding to the mixed performance across the S&P 500 sectors.
Eight of the eleven S&P 500 sectors ended the day in the green, indicating that losses were concentrated primarily in the technology group rather than being spread throughout the broader market.
Oil prices settled lower as traders priced in hopes of renewed U.S.–Iran peace talks. Brent crude futures closed down 44 cents, or 0.38 percent, at 114.88 dollars a barrel, while West Texas Intermediate settled down 78 cents, or 0.76 percent, at 102 dollars a barrel, according to Xinhua.
Investors continued to weigh heavy technology valuations as earnings season proceeds. The widening gap between the strong cloud workload shown by Microsoft and Alphabet’s revenue miss brought added scrutiny to the expected return on large AI projects across the industry.
Market commentators highlighted that the impact from Alphabet’s miss was far greater than typical earnings surprises. The trepidation among traders suggests that the sustained spending on AI remains a sensitive agenda item for investors.
The continued slide in the Nasdaq, which is heavily weighted toward technology names, reflects the persistent unease. The sharp fall in Alphabet shares has become a barometer for tech‑sector sentiment, with performers such as Apple and Tesla hopping over to the downside amidst a cautious mood.
WAM emphasized that market participants remain wary of high tech valuations. Even as some industrial sectors posted gains, the day’s sellers largely nudged technology names, showing how deep the tilted view in return on new AI spending has become.
In summary, while the Dow and S&P 500 pared losses at roughly a quarter of a percent, the Nasdaq’s 1.3 percent slide echoed the broader worry around AI investment costs that swirled in the market after Alphabet’s revenue miss.
All told, the day underscored the continuing finger‑pointing at the cost side of artificial intelligence and the disproportionate weight of Alphabet’s performance on the U.S. tech indices.
