Major U.S. stock indices fell sharply on Thursday, as investor concerns over high spending on artificial intelligence and rising oil prices weighed on markets. The S&P 500 dropped more than 1 percent, while the tech-focused Nasdaq Composite slid over 2 percent, reflecting broader selling pressure.
Investors have grown cautious about the large sums companies are pouring into AI technology, questioning when those investments will generate returns. At the same time, oil prices have climbed, adding to inflationary fears and raising the possibility that interest rates may stay higher for longer. Energy costs affect many sectors, from transportation to manufacturing, and higher oil prices can squeeze corporate profits.
The selloff was widespread, with technology stocks among the hardest hit. The declines come after a period of relatively steady gains in the stock market earlier this year. Analysts note that the combination of AI spending uncertainty and energy price increases has created a challenging environment for investors.
While Thursday's losses were significant, market participants are watching for further developments that could influence trading in the coming days. Economic data releases and corporate earnings reports are expected to provide more clues about the health of the economy and corporate profitability.