Nasdaq Plunges 2.6% on AI Spending Jitters and Yields

### Session Tape - Nasdaq Composite: -2.6% on Thursday, hitting its lowest level in over a month. - Meta Platforms: -7.0% despite strong earnings amid heavy AI infrastructure spending. - Benchmark 10-Year Yield: -3.8% to 4.95%, dipping below 5% for the first time in a month. - Homebuilders ETF (XHB): +3.77% with gains in Restoration Hardware and Lennar.

## Catalyst Analysis: AI Spending Jitters and Yield Shifts Anxiety surrounding the sustainability of heavy AI infrastructure investment weighed heavily on market sentiment on Thursday, Thursday, October 22, 2026. CoreWeave experienced sharp downward pressure in recent weeks, reaching its lowest level since shortly after its IPO as bond yields spiked as high as 15%. Meanwhile, Meta Platforms encountered a 7% pullback despite reporting strong earnings, as investors reacted negatively to the company's first quarter of negative free cash flow driven by soaring capital expenditures. At the same time, relief emerged in fixed income markets as the benchmark 10-year yield fell 3.8% to 4.95%.

## Impact on Sector Rotations As equity tech indexes faced broad selling pressure, capital rotated toward interest-sensitive sectors. The SPDR S&P Homebuilders ETF advanced 3.8%, supported by gains across residential construction and home furnishing equities as lower benchmark yields offered temporary relief to rate-sensitive industries.