Tech stocks slide as AI trade cracks, wiping trillions off US market value

What happened

US technology shares fell sharply on Thursday in a broad sell-off centred on the artificial intelligence trade. Reports put the loss in S&P 500 market capitalisation at an estimated $2.9 trillion, described as the largest single-day drop in market value on record, while investors wiped around $2.5 trillion off the Nasdaq. The group of megacap technology names known as the Magnificent 7 accounted for about $1 trillion of the decline.

Coverage linked the move to growing unease about AI-related valuations, alongside the political shift described in reports as a blue tsunami. Technology stocks logged their weakest session in years.

Why it matters

Megacap technology names carry heavy weight in US equity indices, so a concentrated move in AI-linked shares can drive the headline benchmarks far more than the breadth of the market suggests. When the largest companies move together, index volatility tends to pick up and correlations across asset classes can tighten.

Risk repricing of this scale often spills beyond equities. Crypto has frequently traded alongside high-growth technology exposure, while the dollar and gold can both see flows as investors adjust hedges and cash balances. Shifts in the political backdrop add a layer of uncertainty around tax, regulation and spending expectations that markets attempt to price in.

What to watch

The articles point to continued focus on the AI trade and on the megacap technology names at the centre of the sell-off, as well as the political shift described in the coverage. No specific scheduled data releases, central bank decisions or speakers are named in the reports.