The New Year's eve ball ascends following the closing bell at the Nasdaq MarketSite on June 12, the day of SpaceX's IPO.Jeenah Moon/Reuters
Shares of U.S. technology megacaps tumbled on Monday as SpaceX fell for the third straight session and hyperscalers Alphabet GOOGL-Q and Amazon AMZN-Q looked set to lose billions of dollars in market value, driven by AI spending concerns.
SpaceX (SPCX-Q) slid over 10 per cent after last week’s blistering post-IPO rally. The Elon Musk-led firm said it is launching a notes offering on Monday. At 3 pm ET, SpaceX shares were down about 12 per cent at US$161.81. It IPO’d at US$135 and closed its first day of trading at $160.95.
Alphabet dropped 6 per cent, set for its biggest one-day fall since May 2025 and on pace to erase more than US$256-billion in market capitalization. Google DeepMind’s senior research scientist and Nobel laureate John Jumper said he was leaving for AI startup Anthropic, the lab’s latest high-profile exit.
“This is more of a broader sector pullback on ongoing anxiety over tech companies’ massive capital spend on the AI infrastructure,” said David Wagner, head of equity and portfolio manager at Aptus Capital Advisors.
Amazon.com lost 4.8 per cent, while Meta Platforms META-Q and Microsoft MSFT-Q eased around 3 per cent each. The three stocks together were set to lose more than US$248-billion in market value.
Many Canadian investors will get early exposure to SpaceX IPO because of new Nasdaq rules
Hyperscalers have committed billions to scale up their artificial intelligence infrastructures, though clearer evidence that AI products can generate returns that justify the spends are yet to be seen, raising concerns among investors.
Meanwhile, shares of most chip-related stocks were higher, with memory chipmaker Micron Technology MU-Q leading the way with a 5.8-per-cent gain to hit record highs. Micron also announced a strategic agreement with Anthropic to scale next-generation AI infrastructure.
“There’s a distinguishing aspect of this market between those who are receiving the checks, like memory names and those who are writing the checks,” Aptus Capital Advisors’ Wagner said.
Micron and other data storage companies SanDisk SNDK-Q and Western Digital WDC-Q are the best-performing stocks on the S&P 500 so far this year, emerging as the biggest winners of Wall Street’s hopes of robust AI-related demand.
With reports from Globe staff