U.S. stocks closed sharply lower on Thursday, October 22, as doubts over the scale of artificial-intelligence spending triggered the Nasdaq Composite's worst session since June. The Nasdaq fell 2.6% to 26,009, while the S&P 500 lost 1.21% to 7,663. The Dow Jones Industrial Average finished almost unchanged at 52,868, protected by its heavier weight in defensive companies.
The AI trade cracked
The selling centred on the companies that have carried the market all year. Semiconductor shares dropped about 6.7% in a single session. Meta fell roughly 7% — even though it beat earnings expectations — after investors focused on the cost of its AI buildout, with capital expenditure potentially reaching $145 billion in 2026. CoreWeave and other AI-infrastructure names also came under pressure over financing concerns.
The message from investors is changing: revenue growth alone is no longer enough. Markets now want to see how the data centres, chips and power contracts behind the AI boom will be funded, and how quickly they will produce cash returns.
Defensives quietly held up
Thursday was not a broad panic. Consumer staples, healthcare, financials, real estate and utilities all gained, and the Dow finished in positive territory. The equal-weighted S&P 500 actually rose about 0.73% even as the index itself fell — evidence that this was a concentrated repricing of large growth stocks rather than a uniform rush for the exit. The VIX volatility index climbed to around 19, elevated but far from crisis levels.
Oil is the second problem
Energy markets added a second source of stress. Brent crude rose to about $114 a barrel, its highest in more than five months, and WTI traded near $100 after fresh Houthi attacks on Saudi oil sites raised fears of supply disruption. Expensive oil, if it persists, feeds directly into inflation and complicates the Federal Reserve's path. Gold slipped to around $4,029 an ounce, while the U.S. 10-year Treasury yield sat near 4.95–4.98%.
Friday and the week ahead
Wall Street opened lower again on Friday, with the S&P 500 down about 0.34% and the Nasdaq off 0.44% in early trading. Telecom stocks slid 3% to 4.7% after reports that SpaceX is exploring a nationwide wireless programme, while tower operator Crown Castle jumped about 12.6% on the same story.
The next big test is the Federal Reserve's October 27–28 meeting. A rate hold is widely expected, so the statement's language about December will matter more than the decision itself — especially with oil above $100.
Follow daily market coverage on the Zimbuck News page (https://zimbuck.com/pages/zimbucknews) and join the Zimbuck Market News group (https://zimbuck.com/groups/zimbuckmarketnews) for updates and discussion.
This post is market news and general information only — not financial advice. Always do your own research before trading or investing.
