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U.S. stocks fell sharply on Thursday as a renewed sell-off in the technology sector and concerns that AI could disrupt entire industries widened stock market volatility.
On Thursday, the S&P 500 fell 1.6%, and the tech-heavy Nasdaq Composite Index fell 2%.
Big tech companies led the decline, with Apple falling 5%. Meta fell 2.8% and Amazon fell 2.3%. SoftBank, which has invested heavily in OpenAI and other technology companies, fell 6.5% in Tokyo on Friday.
In addition to tech industry concerns, Cisco’s revenue targets fell short of investors’ expectations, causing the stock to drop 12.3%. AppLovin, an AI-driven mobile app development company, fell 19.7% after the market closed on Wednesday.
U.S. Treasuries rose as investors sought haven assets. The 10-year bond yield fell by 0.08 percentage point to 4.11%, the lowest level this year. Yields move inversely with prices.
The rise in U.S. Treasury prices helped Thursday’s $25 billion 30-year bond auction see record demand. According to BMO Capital Markets, the share of sales by primary dealers (large banks that are responsible for absorbing bonds not purchased by investors) is at an all-time low.
U.S. markets have been volatile in recent weeks as investors worry that the release of more sophisticated AI tools could upend industries such as software and asset management, leading to large-scale layoffs.
At the same time, investors are nervous about the huge investments in AI by “hyperscalers” and when they will see returns. After hitting a record high in late January, the S&P has given up almost all of this year’s gains. The Nasdaq fell nearly 3% in 2026.
Jason Borborashene, portfolio manager at asset management firm NinetyOne, said the decline reflected the market being “trigger-happy” and reacting to all new “AI threats.” “Investors may be hedging risk ahead of tomorrow’s inflation data,” he added, referring to Friday’s U.S. consumer price report.
The Russell 2000 small-cap index, which has benefited in recent weeks from investors dumping big tech companies, was also caught up in the decline, dropping more than 2% on Thursday.
Gold also fell along with stocks, down 3.2% to trade at $4,936 per troy ounce, while silver fell 11%. Precious metal prices have been volatile this year, soaring to record highs last month before plummeting.
“The decline in the stock market has triggered a liquidation of gold to raise cash,” said James Steele, chief precious metals analyst at HSBC. Steele added that a decline in China’s demand for gold ahead of the Lunar New Year “has caused a significant loss of support from the market.”
In another corner of the market, trucking company stocks have plummeted on the promise that AI could transform the freight brokerage industry, which acts as an intermediary between shippers and trucks. Trucking giant CH Robinson Worldwide fell as much as 24%.
The move reversed a sell-off in U.S. Treasuries a day earlier after stronger-than-expected U.S. jobs data led investors to dampen expectations for a Federal Reserve rate cut this year.
Friday’s US inflation data could provide further clues about the expected path of interest rates. Economists polled by Reuters expect inflation to fall to 2.5% last month from 2.7% in December.