AI Spending Shock Sparks $767 Billion Tech Wipeout, Oil Surges Past $100

Wall Street suffered a brutal session on Thursday as Big Tech lost $767 billion in market value after Alphabet and Tesla were punished for sky-high AI spending plans, dragging the Nasdaq down 2.2%. Oil surged past $100 a barrel as Iran tensions escalated, and new data showed jobless claims hit a 187,000 low. Futures edged higher Friday as traders looked to stabilize after the worst session in a month.

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Tesla and Alphabet plunge as massive AI capex spooks investors Tesla fell nearly 15% and Alphabet dropped 7% after earnings, wiping out $767 billion in market value from Big Tech in a single day. Both companies outlined massive increases in capital spending on AI infrastructure, with Alphabet posting its first negative cash flow quarter and Tesla raising its full-year capex forecast, triggering a broad tech sell-off. 1 2 3 4 5

Oil tops $100 and defense stocks rally as Iran tensions escalate Crude oil prices surged past the $100 mark for the first time in months following President Trump's threat of a 'massive attack' on Iran, amplifying inflation fears. Defense stocks surged on the news, with Lockheed Martin eyeing its best day since 2020 on the back of a record $230 billion backlog as geopolitical risk reshuffled market leadership. 6 7 8

Intel posts strongest revenue growth in 15 years on AI demand Defying the bearish sentiment surrounding Big Tech, Intel reported its strongest quarterly revenue growth in 15 years, fueled by 'unprecedented' demand for its AI chips. The results highlight a bifurcated market where semiconductor makers directly supplying AI infrastructure continue to see explosive growth. 9

Jobless claims tumble to a decades-low 187,000 as layoffs stay low Applications for unemployment benefits in the U.S. dropped to 187,000, marking the lowest level in decades and signaling extraordinary strength in the labor market. The robust data complicates the Federal Reserve's policy path as it contends with sticky inflation exacerbated by rising energy costs. 10

AMD unveils Helios AI system to challenge Nvidia, Amkor strikes $1.5B deal AMD officially launched its Helios rack-scale AI system at its Advancing AI conference, boasting performance that beats Nvidia's Vera Rubin, with Microsoft and OpenAI lined up as customers. Separately, Nvidia and Amkor struck a $1.5 billion chip packaging deal to expand capacity for its next-generation AI accelerators. 11 12