Tech stocks are bracing for a decline after Amazon.com Inc. announced higher-than-expected capital spending and a slowdown in its core e-commerce business. The news has spooked investors, particularly given the broader concerns around AI-related expenditures across the tech sector.
Contracts on the tech-heavy Nasdaq 100 Index dropped 2.4% as of 6:30 a.m. in New York, while S&P 500 futures slipped 1.1%. The market reaction underscores the sensitivity of tech stocks to any signs of weakening growth or excessive spending.
The slowest growth in Amazon’s e-commerce business in three years has added to the unease. Investors are increasingly wary of the financial strain that heavy investments in AI and other technologies may place on tech companies’ bottom lines.