[FLASH] AI-financing worries spread tech selloff to software; Nasdaq -2.15%, chip index down 8 straight sessions
On Oct 16 the Nasdaq Composite fell 2.15% to about 26,138 and the S&P 500 fell 1.1% (Reuters preliminary close). Software was hit hard: IGV was down about 4% intraday, PLTR and NOW were down about 5%, CRM was down 4%, and the Motley Fool put AI-focused software losses at about $260B in market value. The Fool cites a Goldman Sachs note saying hedge funds sold AI stocks at the second-fastest pace in more than a year, which Goldman framed as a 'tactical rotation'. Reuters points to fears that debt-heavy AI infrastructure firms may not turn profitable in time to repay borrowings as rates rise, and notes the PHLX chip index fell for an eighth straight session. Next to watch: whether software keeps underperforming QQQ, and next week's Q3 reports, including Meta and Tesla.