The Week the Cracks in the AI Trade Grew Deeper

A facts-only brief, written by a local AI model from this article in The Wall Street Journal, October 30, 2026. It may contain mistakes, and it is not the article: the full story is at wsj.com.

A sharp sell-off in technology stocks on Friday drove the Nasdaq composite to its lowest daily level since June and its worst monthly performance in over a year. The decline followed a week of disappointing financial results from major AI-related companies, marking a significant shift in investor sentiment. Alphabet shares fell 13% on Thursday, their steepest drop on record, after the company reported that growth in its search advertising business had slowed due to the impact of AI-driven queries. This decline negatively affected major shareholders, including Berkshire Hathaway.

Background

• Amazon reported a significant drop in free cash flow and revenue that fell short of analyst expectations late Thursday.
• Intel forecast a prolonged slowdown in personal computer sales, citing pressure from memory chip prices that have risen due to the AI boom.
• Intel shares crashed approximately 30% on Friday, resulting in the loss of over $15 billion in paper holdings for the U.S. government and Nvidia.
• Anthropic recently filed documents showing soaring revenue ahead of its planned initial public offering, which briefly boosted investor confidence before the broader market decline.

Read the full article at wsj.com

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