Alphabet results fuel AI spending fears, Wall Street falls at open
US stocks opened lower on Thursday after Alphabet's results renewed concerns about rising artificial intelligence costs, while investors assessed inflation data after the Federal Reserve kept rates unchanged. The Dow fell 0.74 per cent, the S&P 500 dropped 0.57 per cent and the Nasdaq declined 1.31
US stocks opened lower on Thursday as Alphabet's earnings rekindled worries about soaring artificial-intelligence costs, while investors assessed fresh inflation data following the Federal Reserve's decision to keep interest rates unchanged.
The Dow Jones Industrial Average fell 389.0 points, or 0.74 per cent, to 52,086.13 at the opening bell. The S&P 500 declined 44.4 points, or 0.57 per cent, to 7,699.61, while the Nasdaq Composite dropped 348.0 points, or 1.31 per cent, to 26,201.823, according to Reuters.
Alphabet, Google's parent company, reported quarterly results that reignited market concerns over the escalating costs of developing and deploying artificial-intelligence technology. Investors have been closely watching how major technology firms balance heavy AI investments with profitability.
The market moves came as traders weighed the latest inflation figures following the US central bank's decision this week to hold borrowing costs steady. The Fed's stance on interest rates has been a key factor in market sentiment, with inflation data providing additional context for future policy moves.
The sharpest decline was seen in the technology-heavy Nasdaq index, reflecting the sector's sensitivity to AI-related spending concerns. The S&P 500's more moderate drop suggested broader market caution rather than sector-wide panic.
Analysts noted that Alphabet's results served as a reminder of the immense capital required to remain competitive in the AI race, a theme that has periodically rattled equity markets since the technology boom accelerated.