The technology-heavy Nasdaq-100 index has officially entered a correction defined as a decline of 10% or more from recent highs.
It is the third time this year that the barometer of technology stocks has fallen into correction territory. The latest decline comes as worries of an artificial intelligence (A.I.) bubble intensify.
Technology stocks continued to fall to start November as investors worry about the sustainability of spending on A.I. data centers and other infrastructure tied to the technology.
The Nasdaq 100 ended trading on Nov. 2 at 27,989.82, or 10.4% below its Oct. 6 record-high close of 31,224.47.
Much of the recent decline has occurred over the past week after poor quarterly financial results from tech giants Alphabet (GOOGL) and Amazon (AMZN) spooked investors.
The last time the Nasdaq 100 entered a correction was on July 29 of this year after it fell 11% from a June 2 peak.
Stocks that have been hard hit as investors rotate capital out of technology names include chipmakers such as Intel (INTC), Advanced Micro Devices (AMD), and Micron (MU).
Each of those stocks has fallen 10% or more in the past five trading sessions on Wall Street.
Investors are increasingly shifting capital into blue-chip stock such as Walmart (WMT) and Costco Wholesale (COST) or parking cash in U.S. Treasury bonds.
The buying of U.S. Treasurys has pushed the yield on the benchmark 10-year government bond down below 5%, settling at 4.91% on Nov. 2.
Despite falling into a correction, the Nasdaq-100 is still up 10% on the year through the close of trading on Nov. 2.
The Nasdaq-100 index tracks 100 of the largest non-financial companies listed on the Nasdaq Composite exchange.
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