US Stock Market Weekly Wrap: Nasdaq Crashes 1,213 Pts, S&P 500 Down 2%; Dow Jones Gain; Key Factors

The US stock market ended the week on a mixed note with Nasdaq Composite and S&P 500 indexes crashing the most. Dow Jones outperformed by the end of the week in green. Renewed credit concerns surrounding AI infrastructure have soured investors' mood, who were already rattled with higher-than-expected US CPI inflation data, which calls for aggressive rate hikes ahead. Nasdaq particularly lost 5%, while the S&P 500 index plunged nearly 2%. Even when US Federal Reserve's chair, Kevin Warsh, made no warnings about rate hikes in the October policy, Wall Street could not find a bullish ground.

Dow Jones + Nasdaq Composite + S&P 500

The Dow Jones fell by 175.28 points or 0.34% to 52,002.41 after Warsh's speech at IMF Bangkok meeting. Still, Dow Jones managed to end in positive during the trading week from October 12-16, with 237.09 points gains or 0.5%. This is due to big banks like Goldman Sachs, JP Morgan, Morgan Stanley and Bank of America's Q3 earnings that was released this week.

On the contrary, the tech-heavy index, Nasdaq Composite crashed the most. The index nosedived by 573 points or 2.14% to close at 26,140.03 on October 16, extending its weekly loss to 1,212.48 points or 4.4%.

Among stock-specific action, CoreWeave plunged 11.9%, extending its weekly losses to 23.7% and highlighting renewed credit concerns surrounding AI infrastructure companies. The sector has come under pressure following relatively modest revenue figures from Anthropic and growing concerns about higher interest rates for heavily indebted companies. Economic data released this week showed accelerating consumer inflation and surging producer prices, both at the headline and core levels. Nvidia lost 1.4%, Micron fell 5.6%, and AMD dropped 5.9%. Meanwhile, Tesla declined 2.1% and SpaceX fell 1.7% amid speculation about a potential merger between the companies, as per Trading Economics.

Meanwhile, S&P 500 index slipped by 84.62 points or 1.09% to end at 7,659.44. For the overall week, the index crashed by 153.60 points or 1.97%.

During his speech, Warsh specifically avoided giving any clear guidance on FOMC's next rates decision. The Fed are going to declare their bi-monthly monetary policy in the end of this month.

He shed light on rising energy prices, persistent inflation and higher borrowing costs that create unprecedent uncertainty on the overall global economy. However, he was also optimistic of US economy's growth ahead and believes artificial intelligence (AI) to become major driving factor for future growth.

As per Warsh, AI has become one of the most significant economic changes of his lifetime. However, he did not shy away from warning about heavy investment in AI is creating near-term price pressures.

Also, the US CPI inflation rose to 3.7% in September 2026, higher than market estimate of 3.6%. Inflation surged from 3.4% in the previous month. The reason is the sharp spike in energy prices with gasoline rising by 34.2% YoY and fuel oil prices increasing by 74.2% YoY. Annual core inflation rate stood at 0.3%.

Furthermore, Hariselvan Radhakrishnan, Founder & CEO of HST Wealth highlighted that crude oil has emerged as a key risk, with Brent touching $110 a barrel. A sustained move near these levels could add to inflationary pressures, weigh on the rupee and complicate the outlook for domestic yields and corporate earnings. Any escalation in Middle East tensions that threatens oil supplies could further unsettle sentiment.

Meanwhile, the U.S. 10-year Treasury yield, at around 5.081%, continues to keep global financial conditions restrictive, potentially limiting the appeal of emerging-market equities even as domestic earnings provide support.

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