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The Nasdaq Composite fell 5.5% Thursday to 24,315, its biggest one-day percentage drop since April 2025, while the Dow and S&P 500 also posted sharp losses. Technology stocks led the decline amid concerns about valuations and potential political headwinds for data-center construction; the source does not identify a single confirmed trigger.
The Nasdaq Composite fell 5.5% to 24,315 on Thursday, its largest one-day percentage decline since April 2025, as investors sold technology shares and other market leaders. The Dow Jones Industrial Average dropped 3.4% and the S&P 500 fell 4.4%, while the Cboe Volatility Index reached its highest level since March, according to the source report. The sell-off echoed a dramatic market plunge.
The Nasdaq’s close put it more than 10% below its October 6 high of 27,599.79, a threshold commonly described as correction territory. The report said the index was down 1,421 points; the percentage decline and closing level are also reported as 5.5% and 24,315. All 11 S&P 500 sectors ended lower, with technology falling the most.
Several prominent chipmakers recorded steep losses. Micron Technology fell 17.5% and Sandisk dropped 22.3%. The report said both shares had risen sharply during the year amid enthusiasm for artificial intelligence. Nvidia, a major AI-industry bellwether, lost 9.3%, its largest daily decline since a 17% drop on Jan. 27, 2025, during the DeepSeek-related sell-off. The chip-sector weakness recalls earlier sessions when tech stocks came under pressure.
Shares of large technology companies that have announced substantial AI spending also declined: Alphabet fell 2.2%, Meta Platforms 4.0% and Microsoft 3.6%. The declines came alongside concerns about the cost and prospects of AI-related investment, but the report does not establish that any one concern caused the broad sell-off. Meta has also featured in a previous Nasdaq decline.
Tech Losses Drag Major Indexes
The losses matter beyond technology investors because the Nasdaq’s heavy concentration in technology companies makes sharp moves in large chip and software shares influential across the index. The simultaneous declines in the Dow and S&P 500, and losses in every S&P sector, show that selling was broad rather than limited to a handful of AI-related stocks.
The Nasdaq’s move into correction territory relative to its October 6 high marks a substantial retreat from that recent peak. It does not, by itself, establish what markets will do next. The rise in the VIX, which measures expected near-term volatility based on options prices, indicates increased demand for protection against market swings, not a forecast of a particular outcome.
The session also exposed a divide within the technology trade: many chip and megacap shares fell, while AppLovin rose 31% after reporting results that beat analysts’ estimates, according to the source. That contrast suggests company-specific results still mattered amid the wider decline, although one stock’s advance cannot establish a broader market trend.
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Valuations, AI Spending and Earnings
The source report described two concerns cited around the sell-off: valuations among technology shares and possible political headwinds for data-center construction. It said concerns about Democratic leaders in Washington and in states including Texas and Ohio raised questions about the pace of data-center development. These were presented as concerns associated with the market move, not as confirmed policy changes or a definitive explanation for the day’s losses.
David Bahnsen, chief investment officer at The Bahnsen Group, characterized the technology correction as a response to valuations and investor enthusiasm. He said the rout reflected circumstances in which “euphoria and hype become the reason why stocks go up, rather than fundamentals.” That is his assessment, not a settled finding about what caused the market-wide decline.
Qualcomm provided a separate earnings-related development. The chipmaker reported fiscal fourth-quarter earnings of $2.17 per share on revenue of $10.4 billion, both above Wall Street expectations cited in the report. But its forecast for fiscal 2027 first-quarter earnings—$2.25 per share at the midpoint—was below the analyst estimate of $2.27. Qualcomm shares fell 9.5% during the broader market downturn.
AppLovin moved in the opposite direction after reporting third-quarter earnings of $4.30 per share, up 76% year over year, and revenue of $2.18 billion, up 55%. Both figures beat analysts’ estimates, the report said. Its shares rose 31%, showing that the session was not a uniform decline across every company linked to AI or technology.
“Thursday’s market action is what happens when euphoria and hype become the reason why stocks go up, rather than fundamentals.”
— David Bahnsen, chief investment officer at The Bahnsen Group
The Sell-Off’s Exact Triggers
The available report does not identify a single confirmed event that caused Thursday’s decline. It describes profit-taking in stocks that had risen during the year, concerns about technology valuations, and possible political obstacles to data-center construction, but does not quantify how much each factor contributed. It also does not provide the exact calendar date, trading volume, or detailed moves in other asset classes.
It remains unclear whether the session marked a short-lived pullback or the start of a longer downturn. A one-day decline and a move into correction territory cannot resolve that question. The cited political concerns are not confirmation that specific restrictions on data centers have been adopted.
Earnings and Policy Signals Ahead
Investors will be watching upcoming company results and guidance for evidence about demand for AI infrastructure, chip sales and data-center spending. Qualcomm’s forecast and the contrasting reactions to its report and AppLovin’s results show how earnings expectations can shape individual share moves even during a broad market decline.
Market participants may also monitor policy developments that could affect data-center construction, alongside changes in volatility and the major indexes. The source report gives no schedule for a specific policy decision or further market update. The direction and duration of the sell-off remain unknown.
Key Questions
How much did the Nasdaq fall?
The Nasdaq Composite fell 5.5% to 24,315 on Thursday. The report also described the drop as 1,421 points.
Was the Nasdaq in correction territory?
Yes. The report said the close was more than 10% below its October 6 high of 27,599.79, which it described as correction territory.
What caused the market decline?
The report cited profit-taking in stocks that had risen during the year, concerns about technology valuations and possible political headwinds for data-center construction. It did not confirm a single cause or measure the effect of each factor.
Did all technology-related stocks fall?
No. Many major technology and chip shares declined, but AppLovin rose 31% after reporting quarterly results that beat analysts’ estimates, according to the report.
What should investors watch next?
Upcoming earnings and company forecasts, possible policy developments affecting data centers, and further movements in the major indexes and volatility gauge may help show whether the decline continues. The next market direction is not established by this one-day move.
Source: kiplinger.com
