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Tech Stocks Plunge: Meta, Tesla Drag Wall Street Down
23 Oct
Summary
- Meta Platforms reported its first negative free cash flow, shares dropped 7%.
- Major tech firms lost nearly $800 billion in market cap amid sell-off.
- Rising crude oil prices and AI spending concerns fueled investor caution.
Technology indices on Wall Street experienced a significant downturn on Thursday, October 22, 2026, marked by substantial declines. Disappointing financial results from Meta Platforms and Tesla, alongside growing investor concerns about the substantial spending by AI companies and an increase in crude oil prices, led to a rotation out of high-performing tech stocks.
Investors shifted their focus towards more stable, dividend-paying sectors like consumer staples and utility stocks. This market sentiment caused the Dow Jones Industrial Average to outperform the S&P 500 and the Nasdaq Composite. The Nasdaq Composite saw its most significant single-day fall since June, plummeting by 2.6%, while the Nasdaq 100 dropped by 2.9%.
Meta Platforms' stock price fell by 7% after the company reported becoming free cash flow negative for the first time since its public offering. Additionally, Meta announced increased future spending commitments of $825 billion, up from $700 billion previously. This news negatively impacted its credit risk and bond prices, with the company losing over $100 billion in market value.
The sell-off extended to other major technology companies. Nvidia, Amazon, Microsoft, and Alphabet collectively shed nearly $800 billion in market capitalization. Conversely, Apple and Netflix were among the few tech stocks that managed to close higher amidst the broader market decline. Memory chip manufacturers were particularly hard-hit, with AMD, Intel, and SK Hynix ADRs each declining by 8%.
Further market apprehension arose from comments by Nvidia's CEO, Jensen Huang, who highlighted significant capital constraints within the neocloud sector despite high demand. Simultaneously, crude oil prices continued to rise, with Brent Crude surpassing $113 a barrel following attacks on Saudi Aramco facilities. This volatility in oil markets, coupled with equity market declines, contributed to a sharp fall in bond yields, with the US 10-year Treasury yield dropping below 5% for the first time in over a month.
