Nasdaq drops 1.4% as Alphabet miss revives AI spending fears

US stocks fell Thursday after Alphabet’s quarterly revenue miss and rising AI-related cash burn rattled investors already weighing sticky inflation and the Federal Reserve’s decision to leave rates unchanged. The Nasdaq Composite dropped 1.37%, while the S&P 500 lost 0.3% and the Dow shed 0.25%. Semiconductor stocks fell 1.4%, ending a four-day winning streak, as investors reassessed which companies can sustain aggressive AI investment. Alphabet sank 12.6%. In Europe on Friday, the Stoxx 600 slipped 0.25% and the region’s tech index fell 2% after Amazon and Intel added to concerns over whether large AI outlays will pay off. Small caps held up better in the US, with the Russell 2000 rising 1%.