Nasdaq Loses 4.5% for the Week as AI Funding Fears Mount
Key Facts
The Nasdaq Composite lost 4.5% in the week ended Friday, October 16, 2026, amid concerns about artificial intelligence companies' ability to keep borrowing and spending, according to the Associated Press. The index's weekly loss totaled 1,226.14 points, in a week that saw pressure on shares of chipmakers and computing companies linked to AI. The S&P 500 fell 1.9%, or 152.10 points, over the same period. By contrast, the Dow Jones ended the week up 0.7%, or 347.46 points, bucking the decline in the other two indexes. The results came as investors worried about AI companies' continued reliance on debt markets to finance their current pace of borrowing and spending, alongside rising global yields.
In Friday's session, the S&P 500 lost 1.1%, while the Nasdaq Composite fell 2.1%, according to the Associated Press. The selloff included chipmakers, with Micron Technology shares falling 5.6% and Advanced Micro Devices shares declining 6%. Broadcom shares lost 4.5%, while Intel shares fell 5.8% in the same session. The Wall Street Journal said reports of Chinese advances in semiconductors added pressure on the sector's shares, alongside concerns about AI financing. Describing the impact of the news, the newspaper said that "reports of Chinese advances in semiconductors intensified the selloff in chip stocks."
Pressure had extended to cloud computing companies during the week, with CoreWeave shares falling 15.5% on Wednesday, October 14, according to the Associated Press. In the same session, Oracle shares declined 8.8%, among the losses accompanying concerns about financing AI spending. The news agency linked investor anxiety to companies in the field relying on debt markets at a time of rising global yields. Concerns centered on those companies' ability to continue securing the necessary financing while maintaining their accustomed pace of spending. The agency summed up investors' fears as the possibility of being unable to continue "borrowing and spending at the same elevated pace," a concern that accompanied the decline in computing companies' shares.
CoreWeave's borrowing backdrop includes a bond offering the company announced it had priced in April 2026, according to a statement on its investor website. The private offering had an aggregate principal amount of $1,000 million and comprised senior notes. The company set the notes' interest rate at 9.750%, the rate stated in the offering's pricing announcement. The notes mature in 2031, under the terms CoreWeave announced when pricing the offering, before the selloff in its shares in October. The company said the stated uses of the proceeds included "repaying existing debt," combining new borrowing with the use of part of the proceeds to meet prior obligations.
On prices, annual consumer inflation reached 3.7% in September, according to figures cited by the Associated Press in its coverage of stocks and bonds. The reading compared with an annual rate of 3.4% in August, marking an acceleration in consumer prices in the following month. September's figure also exceeded economists' expectations for annual inflation of 3.6%. The surprise coincided with stock market concerns about debt-dependent AI companies' ability to keep borrowing and spending as global yields rose. Among companies, those concerns emerged during the same week that saw CoreWeave and Oracle fall on Wednesday, before Friday's losses spread to chipmakers' shares.
The next U.S. monetary policy event comes in October, with a meeting of the Federal Reserve's Federal Open Market Committee, according to the central bank's calendar. The meeting begins on October 27, according to the date published on the Federal Reserve's website. It runs through October 28, spanning two days. A press conference follows the meeting, according to the same calendar. The meeting comes after September's reading showed inflation above both August's level and economists' expectations, and following a week in which the Nasdaq and S&P 500 declined while the Dow Jones rose.