The Nasdaq Composite index of technology stocks fell more than 3% at the end of the week. For him, this is the worst week since early April, when the index fell by 10% because of the threat of a trade war, notes the Financial Times.

The main pressure on the market was exerted by the sell-off in AI-related stocks. Over the week, the eight largest AI stocks, including Nvidia, Meta, Palantir and Oracle, lost about $800 billion in capitalization, the publication writes. Shares of Oracle and AMD fell by 9% over the week, Nvidia - by 7%, Broadcom - by 6%.

At the end of trading on November 7, Nasdaq Composite was the only one in the top 3 indices in the red zone: it ended the day with a decline of 0.3%. The broad market index S&P 500 by the end of the trading session recovered losses and showed growth of 0.13%. For the whole week it lost more than 1%. The blue-chip index Dow Jones Industrial Average added 0.16% on Friday, and at the end of the week also lost more than 1%.

"The current decline [in AI stocks] feels more like a cleansing of excessive hype than an undermining of fundamentals," Nationwide Chief Investment Officer Mark Hackett told Bloomberg. - It's kind of a reality check for the hype around AI amid concerns about slowing growth and excessive valuations."

Concerns about overvaluation of Silicon Valley tech companies this week overlapped with signs of a weakening U.S. labor market and falling consumer confidence in the world's largest economy, the Financial Times reported. The University of Michigan's consumer sentiment index fell to its lowest level in three years in November. And according to Challenger, Gray & Christmas, October saw the highest number of layoffs for that month in 22 years. The absence of key economic statistics due to the longest U.S. federal government shutdown in history - it has lasted 38 days - is adding to market anxiety: more and more investors fear that the labor market may have weakened markedly since late September. Investors were also alarmed by a wave of layoff announcements from companies such as Amazon, Paramount and Target, the publication notes.

Additional pressure on stocks this week came from news that celebrity investor Michael Burry bet against AI race leaders Nvidia and Palantir, as well as comments from Goldman Sachs and Morgan Stanley executives. Goldman CEO David Solomon said that "the stock market is likely to correct by 10-20% over the next 12-24 months." Morgan Stanley CEO Ted Pick added: "We should be prepared for a 10-15% decline, not necessarily caused by any macroeconomic shock."

By Friday evening, investors exhaled a little: stocks moved to growth amid hopes that U.S. lawmakers are nearing an agreement that will end the shutdown, Bloomberg writes. In Congress, Democrats offered Republicans short-term funding for the government in exchange for extending tax breaks on the Obamacare medical program for another year. And although the Republicans refused the deal, the very fact of exchange of proposals between the parties was perceived as a positive step, the agency explains.

This article was AI-translated and verified by a human editor

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