Key facts
- Tech stocks, including Alphabet and Amazon, experienced significant declines due to missed earnings expectations.
- Alphabet's stock has fallen roughly 30% since its May peak, entering bear market territory.
- The S&P 500 is set to end October with a small loss, following a similar decline in September.
- Strength in energy and utilities sectors is providing resilience to the broader market.
- Investors are questioning the high valuations of AI companies amid concerns about profit growth.
US stocks are facing a challenging end to October, with the S&P 500 index expected to post a modest monthly loss. Tech stocks, particularly those involved in artificial intelligence, are leading the decline. Alphabet and Amazon reported earnings that missed analyst expectations, contributing to significant premarket drops in their shares. Intel also saw its stock plunge following disappointing financial results. The broader market, however, is showing resilience, supported by gains in the energy and utilities sectors, as well as companies selling essential goods. This divergence suggests that while AI-driven stocks are facing increased scrutiny over their valuations and spending, money is being redeployed within the market rather than fleeing it entirely.