AI shares trade unevenly after Nasdaq slump as investors weigh spending costs
Meta edged lower on October 23 after a sharp fall the previous day, while other major AI-linked shares moved in both directions as investors assessed the cost of expansion.
Meta Platforms edged lower in New York trading on Friday, October 23, after a 7% fall the previous day, as other major AI-linked shares traded unevenly following the Nasdaq Composite’s biggest decline in four months, Reuters reported. The quieter session left investors weighing the cost of AI expansion against expectations of further company disclosures.
SpaceX, Oracle and Dell Technologies rose between 1% and 2%, while Nvidia, Alphabet and Amazon each fell less than 1%, according to Reuters. Major semiconductor stocks were mostly higher after their largest decline since the summer on Thursday. The Nasdaq was little changed on Friday afternoon.
Why Meta’s spending drew attention
Reuters linked Thursday’s pressure on Meta in part to its earnings report. The company said it would create a new class of shares partly to raise money for further capital spending, a plan investors viewed as a sign that the next stage of AI expansion could be costly for shareholders. Meta had announced on October 12 that it planned to release its third-quarter results after the market closed on October 21.
The cost of protecting against a default by major AI companies has risen over the past year as investors assessed the risks of their spending, Reuters reported. Citing LSEG data, it said Meta’s five-year credit-default-swap spread narrowed 0.3% to 123 on Friday after premiums rose on Thursday. Those contracts are used both to hedge credit exposure and to trade on changes in perceived risk.
Rick Meckler, a partner at Cherry Lane Investments, described a market in which buyers had met sell-offs and sellers had checked gains. ‘We really haven’t gotten to the point of the market sort of focusing on winners and losers,’ he told Reuters, describing AI shares as moving largely together.
Funding concerns and the next company disclosures
Shares of smaller AI infrastructure companies, including CoreWeave, have fallen amid concern about their prospects, Reuters reported. The declines have also prompted discussion on Wall Street about whether capital is becoming harder to obtain, which could raise funding costs. Higher Treasury yields since August have added to concern about the returns needed to justify AI spending.
Art Hogan, chief market strategist at B Riley Wealth, told Reuters that investors were watching whether higher inflation, particularly from persistently expensive energy, would eventually affect corporate earnings. He said that effect had not yet appeared.
Investors were also awaiting an expected IPO prospectus from Anthropic in the coming days and earnings reports expected from Alphabet, Amazon and Microsoft the following week, Reuters reported. Those disclosures could give investors more detail on AI revenue and the cost of pursuing it.
Read in depth: Business
Etsy restricts AI-generated patterns and recipes under new seller rules
Sellers must show real results for instructional downloads and disclose AI use in permitted artwork as Etsy tightens its marketplace rules.
Telegraph begins redundancy consultation as Axel Springer sets out AI-led expansion
Telegraph Media Group has begun consulting staff over job cuts while outlining plans to reorganise the publisher, expand abroad and develop new revenue streams. It has not...
Sources and context
- After previous day's slump, trading is quieter among AI sharesCNA (Reuters)
- Meta to Announce Third Quarter 2026 ResultsMeta Investor Relations
AI-assisted article checked against the listed sources. NewsJaws did not conduct interviews or attend the reported events.