The S&P 500 fell 1.3% as inflation data and AI worries hit chip and megacap tech stocks, while defensive stocks rose. Bank of America dropped after missing earnings, even as executives described a strong consumer.
The S&P 500 sank to the lows of the day, down 98 points to 7706. The 1.3% decline is the largest since late July and erases most of this month's gains.
investingLive pairs CPI and AI worries with the decline. AI names and rate-sensitive names both suffered while defensive stocks surged.
Chipmakers and megacap tech lead the selloff
Nvidia lost 3.2% in a broad selloff across chip and memory names. AMD fell 5.6%, Broadcom 3.1%, Micron 3.2%, Intel 4.1% and Dell 11.9%.
Other megacap tech names also took hits from profit taking and AI worries. GOOGL slipped 1.5%, MSFT 1.5%, META 3.6%, TSLA 2.2%, ORCL 7.9% and PANW 5.1%. Apple, however, gained 0.3%, a sign that it's increasingly seen as outside the tech bubble, according to investingLive.
Bank of America falls despite upbeat economic view
Shares of Bank of America dropped 5.8% after it missed earnings. The bank nonetheless sounded upbeat on the US economy and the consumer. CEO Brian Moynihan said: "Consumers continue to spend with year-to-date money moving up 5% from 2025".
In the bond market, 10-year yields turned lower on the day after spiking earlier. Meanwhile, 2-year yields were up only 2.7 bps after jumping 15 bps in the aftermath of CPI.
Source: investingLive
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