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Tech Stocks Lose $1 Trillion as AI Spending Worries Persist

Updated 10:11 PM ET · 5:11 PM ETConfirmed

Technology Desk

In Short: Tech stocks lost $1 trillion in value as concerns over the high costs of artificial intelligence (AI) infrastructure spending continued to weigh on the market.

Tech stocks lost $1 trillion in value as concerns over the high costs of artificial intelligence (AI) infrastructure spending continued to weigh on the market, despite positive earnings from Microsoft.

Investors remain focused on whether the enormous spending required to build AI infrastructure will generate sufficient returns, with Google's weakness highlighting growing concerns about capital expenditure and pressure on future cash flow.

Elon Musk revealed that SpaceX and Tesla are exploring a possible merger, a tie-up that would create a corporate colossus worth more than $3 trillion.

At current valuations, SpaceX and Tesla rank as the world’s seventh- and eleventh-largest companies, respectively, with a combined market capitalization of about $3.5 trillion.

On Monday alone, SpaceX shed $400 billion in market value, with shares tanking 16% that day, CNBC reported.

The Nasdaq 100 has fallen more than 5.8 percent in October as investors question whether Big Tech’s expanding AI investments will generate returns quickly enough.

Analysts note that while near-term rate hike expectations have receded, solid growth prospects and lingering inflation concerns are exerting upward pressure on long-term yields.

Among large-cap stocks, tech names led the advance: Nvidia, Apple, Microsoft, Amazon, Alphabet, SpaceX, and Tesla all posted gains.

The S&P 500 dropped 0.71%, while the tech-heavy Nasdaq fell about 1%.

Senator Michael Bennet is proposing a new federal agency to oversee artificial intelligence and major tech companies.

Insiders at the firm fear tech’s advancement could cause human extinction, while others are calling their declarations of concern a ‘setup’.

Samsung Electronics has become the first technology company in the world to post quarterly operating profit of more than 100 trillion won.

What this adds

Background

What's confirmed

• "Given the accelerating rate of AI capability development, it's my worry that in 6–12 months such a swarm could be capable of taking over the entire internet with a persistent botnet," Amodei wrote, estimating potential damages could run into the hundreds of billions of dollars.

What's still developing

• Silver has turned lower again, raising questions about whether concerns over economic growth and industrial demand are weighing on the metal.
• These concerns could keep equity markets volatile even when individual earnings reports are positive.
• As trillion-dollar tech companies spend hundreds of billions of dollars to build out artificial intelligence data centers, investors are looking for clearer signs that all that spending is actually delivering returns.
• The closure comes as tech-heavy markets in Taiwan, South Korea and Japan have come under pressure amid investor scrutiny of global technology companies’ earnings and lofty spendings on AI.
• The ranks of the “Three Comma Club” hit a record 3,795 people as the AI boom turbocharged wealth creation across the globe.
• He emphasized that Trump was more focused on his relationship with Chinese President Xi Jinping and the tech executives gathered at the White House than on addressing the concerns Americans are facing, including the need for AI regulation, high diesel prices, and high mortgage rates.
• The stock’s market capitalization slipped below $2 trillion as losses accumulated over four consecutive trading days.
• DEVELOPING: Tennessee death row inmate Christa Pike is still alive after two lethal injections, her lawyer says Oil prices surged Tuesday after the U.S. military announced further strikes against Iran, deepening inflation concerns and extending an earlier market sell-off in stocks and bonds.
• “Morocco has long been a popular destination for Israelis, whether they’re visiting to reconnect with their roots, joining organized tours or simply enjoying the country’s culture and food,” Eshet Tours CEO Gil Hahn told The Times of Israel.
• Musk, the world’s richest man with a net worth of more than $900bn, said that a merger would need to clear the “high hurdle” of a 50 percent vote among Tesla shareholders “Some people out there assume that a SpaceX and Tesla merger is a certainty, and I think that would be overstating it,” Musk said.
• According to Bank of America’s Andrew Dock, family offices are taking a keen interest in infrastructure assets such as pipelines and export facilities as they take a longer-term view of energy demand, “ It’s not a cyclical play. This isn’t a commodity trade anymore. It’s a structural shift, ” Dock told CNBC.
• That would top the forecast for Nvidia's latest fiscal year, running from February 2026 to January 2027, of $268.862 billion, or about 360 trillion won, making Samsung the world's most profitable company.

Sources

• Fxstreetlink
• NBC Newslink
• The Korea Timeslink
• Timesofisraellink
• Cnbctv18link
• Al Jazeeralink
• Oilpricelink
• Newsweeklink
• Bnnbloomberglink
• Bennetlink
• Ecikslink
• Enlink
• The Guardianlink
• Financelink
• NBC Newslink
• WarpBeat — background on Tech Stocks Lose $1 Trillion as AI Spending Worries Persist link
• AI Signal Live: Business — video link