Closing Bell: Tech Rout Accelerates on AI Spending Fear, Intel Plunges

Stocks tumbled Friday as a ferocious tech selloff, fueled by disappointing earnings from Intel (INTC) and Amazon (AMZN), that erased October gains and intensified AI spending scrutiny. 

The S&P 500 (SPX) was down 1.8%, the tech-heavy Nasdaq-100 (NDX) fell 3.46%, and the Dow Jones Industrial Average ($DJI) moved lower by 1%. The Russell 2000 (RUT) fell 1.66%. For the week, each index moved lower except the Russell. 

The PHLX Semiconductor Sector Index (SOX) plunged more than 7%, its worst session in months, as Intel's cash-burn warning rippled across chip stocks. The CBOE Volatility Index (VIX) surged to 19.42, while gold (/GC) dropped more than 3% to roughly $3,885 per ounce. The U.S. WTI crude futures contract (/CL) was trading near $103 late Friday. 

Three things to watch from Friday's market: 

Intel Shares Plunge 29% 

Intel had its worst day since 1974 after forecasting fourth-quarter adjusted EPS of 25 cents on revenue of $15–$16 billion, which was below the $17.1 billion analysts expected. CEO Lip-Bu Tan blamed a prolonged PC slowdown and a factory explosion in Israel that caused a two-week shutdown. D.A. Davidson downgraded the stock to Neutral, writing "Not fixed yet." The factory disruption is expected to cost roughly $600 million in revenue over two quarters, adding to concerns about cash burn, weaker PC demand and supply constraints. See INTC Hits 6-Month Lows: Why Earnings Sparked Stock Selloff  

Amazon (AMZN) Revenue and EPS Miss as AI Spend Saps Cash Flow 

Amazon missed revenue and EPS estimates, sending shares down about 1.35% in today’s session despite AWS growth accelerating to 39%, its fastest pace in nearly five years. Investors focused on surging AI-related spending, with Q3 capex reaching $77.3 billion and trailing 12-month free cash flow falling to negative $42.4 billion. Q4 revenue guidance was also slightly soft, while management expects capex to increase meaningfully again in 2027. With some hyperscalers burning cash, investors are questioning when AI investment translates into earnings. See The Big 3: NDAQ, AMZN, SNDK | Trading 360 

Binance Is Victim of Record $6.3B Crypto Hack  

Binance suffered a record $6.3 billion crypto theft, with TRM Labs and Chainalysis attributing the attack with high confidence to North Korean hackers. The exchange suspended some activity and pledged to cover customer losses using company resources and its SAFU emergency fund. Reports indicated some of the stolen assets have been located, but some moved beyond issuers’ reach. See Crypto Heist Costs Binance $6.3B, Bitcoin Sells as Investors Question Crypto Safety 

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