Investors soured on the promise of artificial intelligence Wednesday, sparking a $1 trillion rout in the Nasdaq 100 Index as questions swirled over just how long it will take for the substantial investments in the technology to pay off.
The Nasdaq indexes tumbled more than 3% for the worst days since October 2022. The list of laggards was a who’s-who of AI technology darlings, led by semiconductor companies such as Nvidia Corp., Broadcom Inc. and Arm Holdings Plc.
The selloff was triggered by a middle-of-the-road earnings report from Alphabet Inc. late Tuesday that featured a bloated capital expense. The company’s stock sank more than 5% for its worst performance since January. Tesla Inc. plunged more than 12% after Chief Executive Officer Elon Musk offered scant details about his company’s self-driving vehicle initiative.
