Stocks sink as interest rate hike worries rattle tech amid nonstop AI spending

MarketsStocks sink as interest rate hike worries rattle tech amid nonstop AI spendingA strong jobs report raised the likelihood that the Federal Reserve would raise interest rates this year.Listen to this article with a free account00:0000:00Traders work on the floor of the New York Stock Exchange at the opening bell on May 27.Angela Weiss / AFP via Getty Images fileShareAdd NBC News to GoogleJune 5, 2026, 12:49 PM EDTBy Steve KopackMajor stock indexes fell sharply Friday after a strong jobs report set the stage for the Federal Reserve to hike rates, rattling shares of companies that are involved in sky-high artificial intelligence investments.Subscribe to read this story ad-free Get unlimited access to ad-free articles and exclusive content.The threat of higher interest rates often sends stocks lower because borrowing money, especially at the large sums that AI firms are borrowing at, becomes more expensive.The Nasdaq 100, which tracks the largest non-financial tech stocks traded on the Nasdaq stock exchange, tumbled more than 3%. Leading that index lower were shares of chipmakers Arm, Marvell, Qualcomm, AMD and Intel. Companies involved in the AI data center space, such as Micron Technologies and Western Digital also plunged more than 7%.The S&P 500 fell 1.8% and the Dow Jones Industrial Average fell 450 points. U.S. government bond yields, which influence interest rates paid by consumers, rose to about their highest level in about a week.Still, major indexes remain near record highs. The S&P 500 and Nasdaq are still both holding on to gains of around 10% for the year.Friday’s pain hit several major tech firms. Broadcom, which triggered selling in tech stocks earlier in the week after a lackluster earnings report, fell 6%, bringing its total loss this week to more than 13%. Nvidia, the largest publicly traded company in the world, slid about 5%. Oracle shares lost 9% of their value and IBM dropped 7%, as of mid-day trading.Shares of construction equipment companie...