Nasdaq Falls 5.3% in October: Worst Month Since March 2025

The Nasdaq Composite fell 5.3% in October, its worst month since March 2025, after dropping 2.86% on Friday, October 30, to close at 25,437.00. The S&P 500 fell 1.82% on Friday and 0.9% for the month, while the Dow Jones Industrial Average fell 1.09% on the day but still gained 1.7% in October — a stark split between battered technology stocks and the rest of the market.

What happened on Friday?

Friday was the final trading day of October, and it was the worst day for US stocks since June. The Nasdaq lost 747.72 points, the S&P 500 closed at 7,580.07, and the Dow fell 572.25 points to 51,770.31, according to CNN and Dow Jones market data published by Morningstar. The Nasdaq 100 fell 3.46% on the day, and a closely watched index of chipmakers sank 7.2%.

The index is now 7.8% below its record closing high of 27,599.79, set on October 6 — just weeks ago. October snapped a two-month winning streak for the Nasdaq and left it down for three consecutive weeks.

Why is this blowing up?

The selloff is about one question: can enormous AI spending turn into profit fast enough? Earnings season gave investors reasons to doubt, and Friday's results punished guidance and cash burn far more than headline beats.

Intel was the day's biggest story. Its shares plunged 28.58% to $65.76 — its worst day since 1974 and its second-worst day on record — after it guided fourth-quarter revenue to $15 billion to $16 billion, well below the roughly $17.1 billion analysts expected, and forecast adjusted earnings of $0.25 a share against about $0.43 expected. Intel pointed to a weak PC market, where higher memory costs are hurting demand, and a factory shutdown in Israel. The drop wiped about $12 billion off the value of the US government's roughly 10% stake in Intel in a single day, although that investment remains profitable overall, and about $6 billion off Nvidia's stake, according to CNBC reporting.

Intel was not alone. Amazon fell 1.4% on Friday after revenue and profit missed estimates, it reported negative free cash flow, and it reaffirmed a 2026 capital-spending plan of about $220 billion. That came a day after Alphabet sank more than 12% on Thursday — wiping more than $500 billion off its market value, its worst day on record — and fell another 1.4% on Friday. Reddit fell about 29% on Friday and SanDisk dropped 13%, while Nvidia fell 4.2%, according to Reuters and CNN.

Key facts

• Nasdaq in October: down 5.3%, its largest monthly decline since March 2025 (MarketWatch, citing FactSet).
• Friday's close: Nasdaq -2.86% at 25,437.00; S&P 500 -1.82% at 7,580.07; Dow -1.09% at 51,770.31.
• Dow divergence: the Dow gained 1.7% in October while the Nasdaq fell 5.3% and the Nasdaq 100 fell 6.65% — defensive and non-tech names held up far better.
• Intel: down 28.58% on Friday, its worst day since 1974, after fourth-quarter guidance missed estimates.
• Not everything fell: six of the S&P 500's eleven sectors rose on Friday, with energy, health care and consumer staples advancing even as technology lost more than 4%.

Why the Dow held up better

This was a technology rout, not a uniform collapse. Money rotated out of AI and chip stocks into defensives. Energy rose on strong refining earnings, and health care and staples advanced. That rotation explains how the Dow could finish October higher even while the Nasdaq tumbled, and why the index falls overstate the damage in parts of the market never priced on AI spending.

What's next?

November opens with two immediate tests. First, more earnings: Apple is scheduled to report on Monday, November 2, with more big technology results following during the week, and investors will again judge guidance and free cash flow before headline profit. Second, the US midterm elections on Tuesday, November 3, add political uncertainty at the same moment markets are repricing interest rates and AI valuations. October has changed the burden of proof: as one analyst quoted by CNN put it, the AI trade is "down, but not out" — but spending plans now need earnings to back them up.

Sources

CNN — Nasdaq suffers worst month in over a year as AI nerves roil markets; The Wall Street Journal — Stock Market News, Oct. 30, 2026; MarketWatch — Nasdaq logs worst month since March 2025; Morningstar / Dow Jones — NASDAQ Composite Falls 5.30% This Month; Reuters — October ends with a thud for Intel, Reddit, AI stalwarts.

FAQ

How much did the Nasdaq fall in October 2026?

The Nasdaq Composite fell 5.3% in October 2026, its worst monthly decline since March 2025, and closed the month at 25,437.00.

Why did the Nasdaq fall so sharply on Friday?

Weak guidance and heavy AI spending in tech earnings — led by Intel's 28.58% plunge, Amazon's miss and Alphabet's record drop a day earlier — reignited fears that AI investment is not yet producing matching returns.

Did every stock fall in October?

No. The Dow gained 1.7% in October and six S&P 500 sectors rose on Friday, as energy, health care and staples advanced while technology sold off.

What happens next for markets?

Investors face Apple earnings on November 2 and the US midterm elections on November 3, both of which could move sentiment after October's repricing of AI stocks.