The stock market is down today because the AI-capex selloff that started with Alphabet's after-hours drop on Wednesday spread to chips, led by Intel, and the losses deepened into midday. As of 11:36 AM PT, QQQ traded at $684.72 (-4.28%), the Nasdaq 100 at 28,181 (-4.16%), the Nasdaq Composite at 25,195 (-3.78%), the S&P 500 at 7,536 (-2.39%) and the Dow at 51,608 (-1.40%) (Yahoo Finance data). The VIX rose about 29% to roughly 22.
Why is QQQ down today?
QQQ is down about 4.3% as of 11:36 AM PT because chip stocks are falling hard after Intel's weak fourth-quarter guidance. The semiconductor ETF SMH is down about 8.3% and the tech sector ETF XLK is down 6.2%. Those are the biggest weights in the Nasdaq 100, which is on track for its worst day since June (AP; Bloomberg). Reuters estimated the index was set to erase more than $1 trillion in market value on the day.
- Intel's guide. INTC traded at $63.31 (-31.2%) after a weak Q4 guide; Reuters said it was set for its steepest one-day drop on record. Full story: why is Intel stock down today
- Chips follow. NVDA is down 5.6%, AVGO 7.3% and ORCL 7.1%. Reuters reported AMD down about 10% and Dell and HP down about 9% to 10%.
- AI spending doubts. Day two of worries about the cost of the AI build-out, with Amazon signaling more spending next year. Premarket context: why are Nasdaq futures down today
Why is the stock market down today?
The S&P 500 is down about 2.4% as of 11:36 AM PT because the biggest tech and chip stocks are falling after Intel's weak guide, and a record Binance hack is hitting crypto stocks. The equal-weight S&P 500 (RSP) is down only 1.18%, so the damage is concentrated in megacaps while staples, utilities, energy and health care rise.
Risk-off rotation: what is up today
Money is moving into defensive sectors. As of 11:36 AM PT, 5 of 11 sector ETFs are green, all defensives plus energy:
- Consumer staples (XLP): +1.80%
- Energy (XLE ETF): +1.22%
- Utilities (XLU): +0.96%
- Health care (XLV): +0.72%
- Real estate (XLRE): +0.41%
- Technology (XLK): -6.21%
- Semiconductors (SMH): -8.27%
LLY traded at $1,424 (+3.7%), extending Thursday's gains. Oil is also up, with WTI crude near $104.83 (+2.8%).
VIX today: above 22
The VIX near 22 is up about 29% from Thursday's 17.20 close. Short-dated volatility jumped the most: the 9-day VIX rose about 42% to roughly 22.6, above the VIX itself, an inverted curve that signals near-term stress. QQQ has broken below the 690 area, a big options strike in CBOE data earlier today, and SPY has slipped under 755. QQQ's low so far is $684.41.
This is not a classic flight to safety. The 10-year Treasury yield fell to about 4.94% (-5 bp), but gold dropped 3.5% to about $3,891. Background on the metals move: why is gold down today
Crypto stocks: Binance hack hits Coinbase
Coinbase (COIN) traded near $138 (about -14%) after Binance disclosed a security breach it estimates at about $6.3 billion, which compounded a mixed Q3 report (CoinDesk; crypto.news). Binance said about $3 billion of the stolen funds has been frozen and it will cover customer losses. Coinbase said it was unaffected. Strategy (MSTR) traded at $128.34 (-9.4%) and bitcoin near $76,572.
The Fed: Logan wants at least two more hikes
Dallas Fed President Lorie Logan said the FOMC "needs to implement at least two more 25-basis-point rate increases," then pause to assess (Dallas Fed; Reuters). Earlier, St. Louis Fed President Alberto Musalem said "additional firming of monetary policy will be necessary, and soon" (CNBC; Reuters). Bonds rallied anyway, a sign growth and AI worries are outweighing hike talk at the long end.
Economic data this morning was mixed:
- Employment Cost Index (Q3): +0.8%, in line with estimates (BLS).
- Chicago PMI: 55.3 versus about 56.0 expected, down from 58.8. Prices paid jumped to the highest since December 2021 (MNI).
- UMich sentiment (final Oct): 48.0 versus 46.3 preliminary. One-year inflation expectations held at 4.7%.
Polymarket Fed odds: hike now, cuts later
As of 11:36 AM PT on Polymarket:
- December +25 bp hike: 69.5%, hold 28.5%.
- Two hikes in 2026: 71.5%.
- January hold: 73.5%.
- Rate cut by the July 2027 meeting: 59%. These are thin markets.
- US recession by end of 2026: 6.5%.
The crowd's path: a December hike, then an earlier end to the cycle after the tech shock.
Other movers
- Amazon (AMZN): $237.93 (-2.4%), after trading as low as $229.36. AWS grew 39%.
- Megacaps: MSFT -2.1%, GOOGL -2.1%, META -2.0%, AAPL -1.6%, TSLA -2.1%.
What to watch next
- Whether QQQ can reclaim 690 and SPY 755 into the close.
- Whether the VIX closes above 20.
- Month-end flows into the 1:00 PM PT close, the last trading day of October.
- Apple earnings Monday after the close, ISM manufacturing Monday, and the October jobs report Friday Nov 6.
FAQ
Why is QQQ down today?
QQQ fell about 4.3% to $684.72 as of 11:36 AM PT because chip stocks sold off after Intel's weak Q4 guidance. Intel dropped about 31%, the semiconductor ETF SMH fell about 8% and the tech ETF XLK fell 6.2%. The Nasdaq 100 fell 4.2%, on track for its worst day since June.
Why is the stock market down today?
The S&P 500 fell about 2.4% as of 11:36 AM PT as the AI-capex selloff spread to chipmakers after Intel's weak guide, and a record Binance hack hit crypto stocks. The equal-weight S&P 500 fell only 1.18%, showing losses are concentrated in large tech stocks while staples, utilities, energy and health care rose.
Is the Fed going to raise rates in December?
Markets lean that way. As of 11:36 AM PT, Polymarket priced a December 25 bp hike at 69.5%. Dallas Fed President Logan said the Fed needs at least two more quarter-point hikes, and St. Louis Fed President Musalem said more firming will be necessary "soon."
Is the stock market going to crash?
No one can say. As of 11:36 AM PT, the S&P 500 was down about 2.4% and the VIX was near 22. Losses are concentrated in big tech, while the equal-weight S&P 500 fell only 1.18%. Polymarket priced a US recession by end of 2026 at 6.5%.
Disclaimer: This article is for informational and educational purposes only and is not financial advice. Prices move quickly and may have changed. Do your own research or talk to a licensed professional before making investment decisions.
Sources: Yahoo Finance, CBOE delayed options data, Polymarket, Dallas Fed, BLS, MNI via MarketScreener, University of Michigan via Investing.com, CNBC, Reuters, AP, Bloomberg, CoinDesk, crypto.news, Amazon release via StockTitan, BusinessWire.
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