Stocks fall as Meta, Tesla revive AI worries

Stocks fell on Thursday as technology shares weakened after earnings updates from Meta and Tesla revived concern about the cost and returns of artificial intelligence investment.

Tesla reported lower profits for July to September and cut its capital spending forecast for this year. Meta, the parent company of Facebook, raised its estimates for how much it would spend on artificial intelligence.

Susannah Streeter, chief investment strategist at Wealth Club, said risk-off sentiment was returning amid high geopolitical tensions and worries about financing the AI boom.

Chris Weston, head of research at Pepperstone, said investors were becoming more sensitive to how the next stage of AI investment would be financed and what it would mean for shareholders.

Asian technology shares fell, pulling wider markets lower. South Korean chipmakers SK hynix and Samsung were down 5.5% and 4% respectively, while Japan's Kioxia and Tokyo Electron fell as much as 7%.

Seoul's Kospi lost more than 3%, Tokyo's Nikkei 225 closed down 2.7%, Hong Kong's Hang Seng Index fell 3.0% and Shanghai's Composite Index dropped 1.5%.

European stock markets were also lower in midday trading. London's FTSE 100 was down 0.4%, Paris's CAC 40 was down 1.3% and Frankfurt's DAX was down 0.9% around 1030 GMT.

Oil prices rose at the same time. Brent North Sea crude was up 2.7% at $111.75 a barrel, while West Texas Intermediate was up 2.2% at $99.28.