NEW YORK — A fresh wave of doubt about the artificial intelligence boom hammered Wall Street on Thursday, sending the Nasdaq Composite down 2.6% and the S&P 500 to its worst day since July, while surging oil prices tied to the war with Iran added to the pressure on investors worldwide.

The S&P 500 fell 1.2%, or 93.74 points, to 7,663.43. The Nasdaq dropped 694 points to 26,008.86. The Dow Jones Industrial Average, which holds fewer of the high-flying tech names, held steady, edging up about 0.02% to 52,867.98.

Big Tech Takes the Hit

The damage was concentrated in the companies that have powered the market's rally. Nvidia, the largest U.S. company by market value, fell 4.4% and was the biggest single drag on the S&P 500. Meta Platforms tumbled 7% after reporting revenue that beat expectations but profit that missed, and after announcing plans for a new class of stock to help fund its AI spending.

Chip equipment maker Lam Research sank 11.8%, even though its quarterly results were slightly stronger than expected. The reason: the midpoint of its profit forecast came in a bit below what analysts wanted, a small miss that mattered for a stock that had climbed 52.4% this year. CoreWeave, which rents cloud computing power and borrowed heavily to buy Nvidia chips, dropped 10.1% amid concerns about its debt. Tesla slid 3.1% after beating profit forecasts but reporting weaker revenue.

Why Investors Are Nervous

The selloff reflects a growing worry that the AI boom could be threatened by the cost of financing it. Building data centers and buying advanced chips requires enormous borrowing, and valuations have soared after a multi-year rally. When a company misses a forecast by even a small margin, or announces new ways to raise money, traders have shown they are quick to sell.

The pain was not limited to the United States. In Asia, South Korea's Kospi fell 3.5%, Hong Kong's Hang Seng dropped 3%, and Japan's Nikkei 225 lost 2.7%. In South Korea, memory-chip giant SK Hynix said it was suspending the U.S. Nasdaq listing of its Solidigm unit after the overnight slide in AI and semiconductor shares. France's CAC 40 fell 1.4%, with French bond yields rising on concerns about government debt amid street protests.

Oil Climbs to a Five-Month High

Energy markets added to the anxiety. Brent crude rose 4% to $113.17 a barrel, its highest level in about five months and up sharply from below $97 at the start of October. Traders are worried about the war with Iran and how soon global energy supplies will return to normal. Higher oil prices feed through to gasoline, shipping, and airline costs, and they can complicate the Federal Reserve's efforts to keep inflation in check.

Investors sought safety in government bonds. The yield on the 10-year U.S. Treasury fell to 4.97% from 5.13% the previous day, and from above 5.30% earlier in the month. Falling yields can reflect a flight to safety, though they can also ease borrowing costs for mortgages and businesses.

Not Everything Fell

Despite the headline drop, roughly two-thirds of S&P 500 stocks actually rose, a sign that the sell-off was a tech-specific rout rather than a broad collapse. Procter & Gamble gained 5.6% after beating profit expectations and keeping its full-year forecasts, while Lockheed Martin and CSX also reported earnings above estimates. Economic data was mixed but mostly encouraging: fewer Americans filed for unemployment benefits, suggesting layoffs remain low.

What It Means for Your Money

Because the biggest tech companies make up such a large share of major indexes, they can pull down 401(k)s and index funds even when most stocks are rising. Americans with retirement accounts tracking the S&P 500 or Nasdaq felt Thursday's decline whether or not they own a single AI stock.

The bigger issue is whether Thursday was a one-day shakeout or the start of a longer reassessment. The AI trade has repeatedly wobbled this year, and each wobble has tested the idea that spending on data centers will pay off quickly. Oil is the other variable: if crude keeps climbing, higher energy costs could squeeze households and companies at the same time that investors are asking tougher questions about tech.

This article is for informational purposes only and is not investment advice. Readers should consult a licensed financial professional about their own situation.