Nasdaq Suffers Worst Week Since June as AI Sell-Off Hits Chip Stocks

TLDR

• The Nasdaq fell 2.14% Friday to 26,140.03, its worst week since June.
• Chip stocks dropped, with the VanEck Semiconductor ETF down 10% on the week.
• CoreWeave fell nearly 12% Friday and is down 25% this week.
• Oil rose above $100 as U.S.-Iran and Russia-Ukraine tensions grew.
• Traders see an 82% chance the Fed holds rates at its Oct. 27-28 meeting.

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US stocks fell on Friday as investors sold technology and artificial intelligence shares. Oil prices also rose, adding pressure to the market.

The Nasdaq Composite lost 2.14% to close at 26,140.03. It was the index’s worst week since June and ended a four-week winning streak.

The S&P 500 fell 1.09% to 7,659.44. The Dow Jones Industrial Average dropped 175.28 points, or 0.34%, to 52,002.41.

Both the S&P 500 and the Nasdaq finished below their 50-day moving averages. The Cboe Volatility Index rose above 22 for the first time in four months.

Chip Stocks Lead the Decline

Chipmakers fell again on Friday. The VanEck Semiconductor ETF lost 3%, led by Micron Technology, Advanced Micro Devices and Sandisk.

There it is folks.

The Nasdaq 100 is now down -3% on the day and on track for its biggest weekly decline since April 2025.

US tech stocks have erased over -$3 trillion in market cap in just 10 days.

This puts the Nasdaq 100 just ~2.5% away from entering a technical correction.… https://t.co/CuUwtwaw5V pic.twitter.com/Llhtk5QUoj

— The Kobeissi Letter (@KobeissiLetter) October 16, 2026

The fund dropped 10% for the week, its biggest weekly decline since April 2025. Investors have worried about competition from China.

CoreWeave shares fell nearly 12% on Friday and are down 25% for the week. The company’s total debt has risen to more than $51 billion.

CrowdStrike dropped 7% and Oracle fell 4.5%. Investors are also asking questions about the business models of Anthropic and OpenAI.

Nick Colas of DataTrek Research said investors are “burnt out on AI.” He said the catalyst is interest rates.

Michael Rosen, chief investment officer at Angeles, said rising debt issuance is worth watching. He said the market is not close to excessive levels right now.

Not all of the market fell. In the S&P 500, 221 stocks rose on Friday, and the Dow gained 0.7% for the week.

Oil and Inflation Add Pressure

Oil prices rose as tensions grew between the U.S. and Iran, and between Russia and Ukraine. West Texas Intermediate crude rose 3.51% to $101.41 per barrel.

Brent crude gained 3.72% to $109.86. Energy stocks such as Chevron rose and helped limit the Dow’s losses.

Inflation data has also worried investors. Wholesale inflation posted its biggest gain since 2022 this week, and consumer inflation remains well above the Federal Reserve’s 2% target.

Fed Chairman Kevin Warsh spoke at an IMF event in Bangkok overnight. He did not say whether the Fed would raise rates before year end.

Traders took that as a sign the Fed will hold policy steady. The CME Group’s FedWatch tool shows an 82% chance the Fed keeps rates unchanged at its Oct. 27-28 meeting.