TREE NEWS reports: The three major US stock indexes opened lower, with the Dow down 0.45%, the S&P 500 down 0.5% and the Nasdaq down 1.35%. Alphabet fell more than 11% after its Q3 revenue missed expectations and cash burn intensified, dragging AI software stocks lower. ServiceNow dropped 22%, its biggest intraday decline since 2016, while Caterpillar fell 12% at the open, now 40% below its June high.
US stocks open lower; Nasdaq falls 1.35% as Alphabet drops over 11%
AI take
The concentration of weakness in AI-linked software names, rather than the broader index, suggests the market is repricing the cost side of the AI trade — Alphabet's cash burn and ServiceNow's steep drop point to scrutiny of spending rather than demand. That distinction matters for anyone holding exposure to the AI theme, since it implies earnings quality is being reweighted, not the narrative itself. The divergence with Caterpillar, down sharply on separate grounds, complicates reading this as a single risk-off move. Whether the software selloff stays contained to companies with visible spending strain is the open question.
Generated by AI for reference only.
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