Wall Street has closed out October with its worst session since June, as a brutal tech sell-off collided with a question investors had been avoiding all year: when does the enormous spending on artificial intelligence actually pay back? The Nasdaq Composite fell 2.86 per cent, the S&P 500 lost 1.82 per cent and the Dow Jones slipped 1.09 per cent, capping the Nasdaq’s worst month since March 2025.
Inside the Tech Sell-Off: Big Names Moved Like Meme Stocks
The violence of the moves was the story. Intel closed 28.6 per cent lower, Reddit fell 29.2 per cent in its worst day since listing, Illumina dropped 18.6 per cent and Roblox 18.1 per cent, while AMD lost 10.9 per cent. As one widely shared market analysis of the crash pointed out, the biggest names on Wall Street swung more wildly than Bitcoin managed on its worst day in years. The VIX fear gauge rose nearly 13 per cent, though at 19.4 it signalled nervousness rather than panic.
Alphabet Lit the Fuse
The sell-off began on Thursday, when Alphabet fell 12.6 per cent, its steepest drop since its 2004 IPO, wiping out roughly $500 billion in value. Investors are no longer rewarding AI capital expenditure unless the cash comes back visibly and quickly. That mood then met a cluster of weak outlooks from Intel, Reddit and Roblox, each punished as if the market were making up for months of suspended disbelief in a single week. The pattern matches our coverage of breaking economic trends reshaping markets this year.
A Heavy Week Ahead
The calendar offers no rest. US midterm elections fall on Tuesday, AMD and Arm report earnings, and the October jobs report arrives on Friday. The Federal Reserve, which held rates at 3.75 to 4.00 per cent on Wednesday with two officials voting for a hike, has added its own uncertainty. Apple reports after Monday’s close, and after this week, investors will read its AI spending plans with a far colder eye.
One bad week does not make a bear market, and the major indices remain not far below record highs. But the burden of proof has shifted. For the rest of earnings season, technology companies will have to defend their AI budgets line by line, and those that cannot should expect more Fridays like this one.
