AI and Chip Stocks Shed $5 Trillion Since Early October as Nasdaq Posts Worst Month Since March 2025

The AI trade has had its worst stretch in more than a year. A basket of 47 U.S. AI and chip stocks has shed about $5 trillion in market value since October 6, while 625 other large U.S. stocks gained $1.3 trillion over the same period, according to Yahoo Finance data cited by Hokanews. The Nasdaq lost about 5.3% in October, its worst month since March 2025.

The sharpest single blow came on October 30, when INTC plunged 28.6%, its worst drop since 1974, after a weak fourth-quarter outlook, according to the Associated Press. Alphabet (GOOGL) fell more than 12% the same day, and the S&P 500 dropped 1.8% while the Nasdaq fell 2.9%. The divergence matters: the damage is concentrated in AI names rather than spread across the market.

Investors are also paying more to hedge. Semafor reported in mid-October that protection on $1 million of CoreWeave debt cost $100,000, up from under $40,000 a year earlier. Some strategists are modeling worse outcomes: TS Lombard sketched a scenario in which U.S. stocks fall at least 30% and about $20 trillion is erased, while assuming only a mild recession and a recovery in early 2028.

The next tests are the AI-heavy earnings still to come this season and whether the gap between AI stocks and the rest of the market keeps widening. A stabilization in chip shares, or further de-risking, will set the tone for the rest of November.