Philadelphia semiconductor index logs longest losing streak since 2008 financial crisis amid AI debt fears

Major US stock indexes fell across the board Friday (local time) as concerns over debt levels at AI infrastructure companies and a sharp rise in oil prices weighed on investor sentiment.

The Dow Jones Industrial Average closed down 175.28 points, or 0.34 percent, at 52,002.41 on the New York Stock Exchange.

The S&P 500 fell 84.62 points, or 1.09 percent, to 7,659.44, while the NASDAQ Composite dropped 572.99 points, or 2.15 percent, to 26,140.03 — its steepest single-day decline since July 23.

For the week, the NASDAQ lost 4.48 percent, the S&P 500 shed 1.95 percent and the Dow fell 0.67 percent.

Worries about AI infrastructure companies that have relied heavily on borrowed money to expand data centers and other facilities dragged on the market. CoreWeave tumbled 11.91 percent, while Nebius fell 12.18 percent and Iris Energy dropped 11.19 percent.

Semiconductor stocks also came under heavy selling pressure. Micron fell 5.63 percent, Broadcom dropped 4.52 percent, SK hynix's American depositary receipts lost 6.58 percent and AMD declined 5.95 percent.

The Philadelphia Semiconductor Index fell 3.83 percent, extending its losing streak to eight consecutive trading sessions — the longest such run since the global financial crisis in 2008.

Big Tech names were also hit, with Meta falling 3.72 percent, Alphabet dropping 2.47 percent and Microsoft declining 1.93 percent. Growing skepticism about the profitability of AI infrastructure investment pushed technology stocks to their worst weekly performance since June.

Healthcare and financial stocks held up relatively well, however, as money rotated out of technology. Eli Lilly gained 0.43 percent and JPMorgan rose 1.25 percent.

Rising oil prices, driven by geopolitical risk, added further pressure on investor sentiment.

Brent crude, the global benchmark, settled at $109.86 a barrel, up 3.72 percent — its highest close since May 19.

West Texas Intermediate crude also surged 3.51 percent to settle at $101.41 a barrel, its highest level since Sept. 17.

The CBOE Volatility Index, Wall Street's so-called fear gauge, briefly topped 22 during trading for the first time in four months before closing up 21.45 percent at 19.99.

In the options market, large-scale call option buying concentrated on bets that the VIX would climb even further in the near term, reflecting deepening anxiety among investors.