Nasdaq Loses More Than $2 Trillion in October as AI Spending Fears Rattle Markets

NEW YORK, 31 October 2026 — More than $2 trillion in market value was set to be wiped from the technology-heavy Nasdaq 100 during October, according to Reuters reporting on 30 October 2026, as a bruising month for Big Tech ended with a sharp sell-off that sent the Nasdaq composite to its biggest single-day fall since June. The rout capped a month in which investors turned from enthusiasm about artificial intelligence to anxiety about how much the boom is costing, how it is being financed, and how quickly it will pay off.

Illustration: A stock market trading screen with falling red charts, in stylised editorial illustration form.

What Happened

On Friday 30 October 2026, the last trading session of the month, the Nasdaq composite fell sharply, Reuters reported, while the Nasdaq 100 index of large non-financial stocks dropped 3.5 percent on the day after falling further intraday, leaving it on the brink of a correction — a fall of 10 percent from its recent high. The Nasdaq composite ended the month 7.8 percent below its closing high, after what Reuters described as its worst month since March 2025, erasing a large part of this year's AI-driven gains.

The selling was broad. Chipmaker Intel and social media firm Reddit were among the steepest fallers on Friday, Reuters reported, while memory-chip maker Sandisk, one of the biggest beneficiaries of the AI capital-spending boom, dropped 13 percent. The four so-called hyperscalers at the centre of the AI buildout — Microsoft, Meta Platforms, Amazon and Google parent Alphabet — each fell 1 to 2 percent on Friday, after significant declines earlier in the week.

Beyond technology, financial stocks were hit hard, with Goldman Sachs down 4 percent and Jefferies down 6 percent, Reuters reported. Safe-haven government bonds rallied as investors pulled back from risk: silver fell 6 percent on the day, leaving it down 31 percent for the year, while gold fell 3.5 percent, leaving it down 10 percent for 2026. Oil prices rose 2 percent, adding to worries about an American economy that many investors see as dependent on the AI buildout for momentum. Bitcoin fell 3 percent after hackers took more than $6 billion from the Binance exchange, according to the same reporting.

The October wipeout figure is striking in scale. Reuters put the Nasdaq 100's monthly loss at more than $2 trillion — slightly more than the entire market value of SpaceX, as the report framed it. Before Friday's final session, the index had already fallen more than 5.8 percent in October, as earnings from the largest technology companies intensified scrutiny of whether tens of billions of dollars poured into AI infrastructure can generate returns quickly enough.

Background

The month's turbulence followed a week of Big Tech earnings that gave investors plenty to worry about. Alphabet suffered its biggest one-day percentage fall on record on Thursday, Reuters reported, after disappointing results in its core search advertising business and a sharp acceleration in cash burn. Meta's plans for a record $97.5 billion fund raise heightened concerns about shareholder dilution and whether mounting AI spending could force other large technology companies to tap capital markets increasingly often.

Microsoft and SpaceX were exceptions to the gloom in Reuters' earnings roundup, with results that suggested AI spending was starting to pay off. Amazon's cloud business, Amazon Web Services, continued to accelerate, while Meta reported better-than-expected revenue growth and an upbeat outlook, and Microsoft forecast strong cloud growth. Revenue across the so-called Magnificent Seven has remained strong since the launch of ChatGPT in 2022, Reuters noted — which is part of why investors were initially willing to back the spending, even though the timeline for payoffs remains uncertain.

What changed in October was the financing question. The four hyperscalers have together accounted for more than a third of all capital spending by current S&P 500 constituents over the past 12 months, according to Capital Economics, cited by Reuters, and their share looks likely to rise further. As that spending has come to depend partly on external financing, investors have grown more nervous about both the sums involved and how they are being raised.

Illustration: A vast AI data centre with rows of servers, in stylised editorial illustration form.

Microsoft is reportedly planning to raise about $25 billion through its first United States investment-grade bond sale in more than nine years, Reuters reported, while Meta, Amazon and Alphabet have issued hundreds of billions of dollars in bonds over the past four years. Morgan Stanley forecasts that capital spending on AI infrastructure overall will pass $1 trillion next year, and J.P. Morgan expects global AI capex to reach $5.5 trillion by 2030, with $900 billion spent in 2026 alone. This year's AI spending by Amazon, Alphabet, Meta, Oracle and Microsoft would likely equal their combined spending since ChatGPT's launch in November 2022, according to J.P. Morgan analysts cited by Reuters.

The central-bank backdrop added to the tension. The US Federal Reserve, the European Central Bank and the Bank of Japan all held interest rates steady in the week of 27 October 2026, Reuters reported in its weekly markets review, but markets still expected further tightening from the three central banks by year-end after all three raised rates in tandem earlier in the year. Hopes that inflation would gradually return to around 2 percent targets have been upended by the escalating war involving Iran, with crude oil prices holding in triple digits eight months into the conflict, raising fears that energy shocks will spread price rises more widely across major economies.

Why It Matters

The October sell-off matters because it tests the central investment story of the past four years: that AI spending, however large, would be rewarded quickly. For much of that period, investors accepted enormous capital expenditure on the strength of revenue growth and the promise of future returns. October showed what happens when that patience thins — when earnings disappoint, cash burn accelerates, and borrowing costs rise, the same spending that once looked visionary starts to look like a liability.

The concern is now spreading beyond share prices into credit markets, Reuters reported, where investors are starting to price in the possibility that rising financing costs, combined with slower returns on AI spending, could squeeze companies previously viewed as relatively insulated from macroeconomic pressures. The cost of insuring against debt default has surged for AI companies, according to the same reporting, challenging the view that the firms at the heart of the boom are immune to wider economic forces.

It also matters for the wider economy. With the hyperscalers responsible for such a large share of S&P 500 capital spending, a pullback — or even a slower pace of increase — would ripple through suppliers, chipmakers, data-centre builders and power providers. Conversely, if spending continues at the planned pace while returns lag, the debt pile grows and the eventual adjustment could be sharper. Either path carries consequences well beyond technology shares, as Friday's falls in banks, precious metals and cryptocurrencies illustrated.

Illustration: Global investors watching a falling stock chart over a city skyline, in stylised editorial illustration form.

For ordinary savers, the month is a reminder of concentration risk. The Nasdaq's gains this year were driven heavily by a handful of companies; its October fall was driven by the same handful. Pension funds and index trackers holding broad market exposure felt the decline even without owning individual technology stocks directly, because those companies now make up such a large share of major indices.

What Happens Next

Investors now face a busy November that could either calm or deepen the anxiety. Apple is set to report earnings next week, Reuters noted, and AI bellwether Nvidia reports in mid-November — two results that will test whether the earnings season's gloom was company-specific or sector-wide. A new trading month also brings fresh data: the United States midterm elections take place on Tuesday, followed by the October non-farm payrolls report on Friday, which could clarify the Federal Reserve's next move. Markets are pricing about an 80 percent chance of a Fed rate rise in December, according to Reuters' week-ahead preview.

Several other central banks meet in the coming week, including the Reserve Bank of Australia, Sweden's Riksbank, the Bank of England and Norges Bank, with markets expecting rate rises from several of them. How those decisions land — and whether policymakers signal further tightening — will shape borrowing costs for the debt-funded AI buildout.

The key question, as one strategist quoted by Reuters put it, is who will monetise the investment and who will not. Until earnings show that AI spending is converting into durable profits at a pace that justifies its scale, markets are likely to stay volatile. A new month may bring a fresh start, as Reuters' Friday report suggested — but after a month that erased more than $2 trillion, investors will want proof, not promises, before they buy back in.

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FAQ

How much value did the Nasdaq 100 lose in October 2026?

More than $2 trillion in market value was set to be wiped from the Nasdaq 100 during October, according to Reuters reporting on 30 October 2026 — slightly more than SpaceX's entire market value, as the report framed the scale of the loss.

What triggered the October sell-off?

Big Tech earnings intensified investor scrutiny of AI spending, Reuters reported. Disappointing results, accelerating cash burn, record fundraising plans and rising borrowing costs combined to unsettle investors who had previously backed the AI buildout enthusiastically.

How far did the Nasdaq fall?

The Nasdaq 100 fell 3.5 percent on Friday 30 October, putting it on the brink of a 10 percent correction from its recent high, while the Nasdaq composite ended the month 7.8 percent below its closing high after its worst month since March 2025.

Which companies were hit hardest on Friday?

Intel and Reddit were among the steepest fallers, Sandisk dropped 13 percent, and the four hyperscalers — Microsoft, Meta, Amazon and Alphabet — each fell 1 to 2 percent, according to Reuters. Goldman Sachs fell 4 percent and Jefferies 6 percent.

What should investors watch next?

Apple's earnings next week and Nvidia's in mid-November, the US midterm elections, the October jobs report, and a run of central-bank meetings — all of which could shape expectations for interest rates and for the pace of AI spending.

Sources

Reuters, 30 October 2026 — "October ends with a thud for Intel, Reddit, AI stalwarts" (Friday sell-off, Nasdaq composite and Nasdaq 100 moves, hyperscaler and bank falls, gold, silver, oil and Bitcoin moves, Capital Economics analysis).

Reuters, 30 October 2026 — "Nasdaq faces $2 trillion wipeout in October as AI spending fears deepen" (monthly wipeout estimate, Alphabet and Meta earnings detail, Microsoft bond-sale report, Morgan Stanley and J.P. Morgan capex forecasts, credit-market concerns).

Reuters, 30 October 2026 — Reuters Open Interest weekly review and week-ahead preview (Federal Reserve, European Central Bank and Bank of Japan holding rates steady, market expectations for tightening by year-end, US midterms and payrolls, Apple and Nvidia earnings timing).