Major US stock indexes ended a volatile week with losses concentrated heavily in technology shares, as investors grew more cautious about how the artificial intelligence buildout is being financed.
The Nasdaq Composite fell 2.1 percent on Friday and dropped 4.5 percent for the week overall, its worst weekly performance since late June, snapping a month-long winning streak. The S&P 500 fell 1.1 percent on Friday and 1.95 percent for the week, while the Dow Jones Industrial Average, less exposed to technology stocks, actually gained 0.7 percent for the week even as it slipped 0.3 percent on Friday, reflecting a rotation of money away from tech and into other sectors.
Much of the unease traces back to CoreWeave, a cloud computing company backed by Nvidia that rents out data center computing power for AI workloads. Its shares and bonds tumbled sharply earlier in the week, at one point falling more than fifteen percent in a single session, as rising yields on its corporate debt drew attention to how much borrowing is underpinning the broader AI infrastructure boom. Nvidia chief executive Jensen Huang, whose company holds a large stake in CoreWeave, said publicly that he remained optimistic about the business despite the swings. Industry analysts have estimated that AI providers could spend nearly a trillion dollars on infrastructure this year alone, with several trillion more projected between 2027 and 2030, numbers that have made investors increasingly sensitive to any sign of strain in how that spending is funded.
Semiconductor stocks were among the hardest hit, with chip-focused exchange-traded funds on pace for a ninth consecutive losing session. Brent crude's climb toward one hundred ten dollars a barrel, tied to the unrest in the Strait of Hormuz, added another layer of caution for investors already digesting a hotter than expected inflation report earlier in the week.
Investors will be watching next week's batch of corporate earnings, along with any further moves in CoreWeave's stock and bonds, for signs of whether the AI financing jitters are easing or spreading further.
Why did CoreWeave's stock swing so much?
Rising yields on its corporate debt raised questions about how the company is financing the enormous cost of building AI data centers.
Did all tech stocks fall?
Semiconductor and software shares were hit particularly hard, while the broader Dow, which has less tech exposure, still posted a weekly gain.