AI stock losses pull Wall Street lower as oil prices climb

Losses in artificial intelligence stocks pulled Wall Street lower Thursday, putting the S&P 500 on track for its worst day since July, according to The Korea Times. Oil prices climbed as uncertainty over the war with Iran clouded prospects for normal global energy operations.

Nearly two-thirds of S&P 500 stocks rose, but losses in heavily weighted technology companies outweighed those gains. The divergence came amid concerns about borrowing costs for AI infrastructure and valuations after a yearslong rally.

The S&P 500 was down 1.4% and the Nasdaq composite fell 2.8% in intraday trading, The Korea Times reported. The Dow Jones Industrial Average was down 113 points, or 0.2%, as of 2:30 p.m. Eastern time. The figures were not closing results.

Nvidia fell 4.3% and was the biggest drag on the S&P 500. CoreWeave dropped 11% amid concerns about debt used to purchase Nvidia chips for its cloud rental business, while Tesla declined 2.6%.

Lam Research sank 11.6% despite summer earnings and revenue that slightly exceeded analysts' forecasts. The midpoint of its quarterly profit outlook fell slightly short of expectations. Meta Platforms lost 7.9% after reporting stronger-than-expected revenue but weaker-than-expected profit and announcing a new stock class to finance AI investments and other expenses, according to The Korea Times.

Losses extended overseas. South Korea's Kospi fell 3.5%, Hong Kong's Hang Seng dropped 3% and Japan's Nikkei 225 declined 2.7%. France's CAC 40 fell 1.4%.

Brent crude rose 3.7% to $112.80 a barrel, its highest level since May, as uncertainty persisted over when the war with Iran would permit normal global energy operations to resume. Investors sought U.S. government bonds, sending the 10-year Treasury yield to 4.96% from 5.13% late Wednesday. French government bond yields moved higher amid worries about debt, budget pressures and demands for more spending.

Other developments offered a counterpoint to the technology sell-off. A report showed fewer U.S. workers applied for unemployment benefits last week, while Procter & Gamble gained 6% after maintaining its full-year growth forecasts despite anticipated geopolitical and economic challenges, according to The Korea Times.