Nasdaq Under Pressure: Risks of Further Declines Increase

Wall Street faces a challenging week following Friday’s sharp sell-off in the Nasdaq, extending the significant correction in the technology sector seen throughout October. Selling pressure has been particularly concentrated in companies linked to artificial intelligence and semiconductors, reflecting a shift in investor sentiment towards the massive investments being made by major players such as Amazon, Alphabet and Meta. Investors are increasingly questioning when this spending will translate into higher profits and stronger cash flows. The weakness in the Nasdaq is particularly concerning given the deterioration in market breadth: by Monday’s close, only around 36% of its constituents were trading above their 50-day moving averages, highlighting the fragile underlying market structure and casting doubt on the sustainability of any recovery attempt. Although the S&P 500 remains relatively more resilient, the risk of weakness spreading across the broader market is increasing.

Over the coming days, attention will focus on economic activity and employment indicators in the US and Europe, as well as decisions and communications from major central banks. Inflation figures will be particularly important in assessing the impact of higher energy prices on business costs and interest rate expectations. The combination of potentially higher interest rates, demanding equity valuations and growing doubts about the profitability of AI investments creates a particularly challenging environment for US stocks. The renewed appeal of government bonds as safe-haven assets also reflects increasing investor caution. Against this backdrop, the Nasdaq remains the main area of concern, and further selling pressure cannot be ruled out if disappointing corporate earnings reinforce doubts about the technology sector.

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Original analysis by Miguel A. Rodriguez, dated 3 November 2026.

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