Google's owner lost $500bn in one day. Will the S&P 500 end 2026 at 8,000 or more?
Alphabet lost just over $500bn on 29 October. On 30 October the S&P 500 fell to 7,580.21. It must rise 5.5% to reach 8,000.
What happened
The S&P 500 fell 23.59 points to 7,720.39 on , even though most shares in the index rose, as Alphabet had its worst day in more than 20 years.
Alphabet, the company that owns Google, lost just over $500bn in value on . Its shares fell more than 12%, to a six-month low. Its total value dropped from $3.97 trillion to $3.46 trillion. Sales grew 25% to $127.6bn in the three months to September, but less than analysts expected, mostly in advertising. Google said its own AI answers in search are taking money from the adverts next to normal search results.
The fall pulled down the S&P 500, an index of 500 large US companies. It lost 23.59 points to 7,720.39, its first fall in four days, even though most shares in the index rose. Alphabet is one of the biggest companies in the index, and its shares fell 12.6%, their worst day in more than 20 years. To end the year at 8,000 or more, the index has to rise 3.6% from that close.
Amazon reported on the same day. Its results were below what analysts expected, and its shares fell more than 6% after the market closed. Amazon plans to spend $220bn this year, mostly on AI. Microsoft and Alphabet also plan to keep spending huge sums on AI, and investors worry about when that money will come back.
The index was at a record only three weeks earlier. On it closed at 7,818.93, above 7,800 for the first time. Oil is expensive because of the war with Iran: Brent crude, the world price, rose 2.54% to $117.80 a barrel on . The US central bank kept its interest rate at 3.75% to 4% on and meets again on 8 and .
All told, the S&P 500 fell 23.59 points to 7,720.39 Thursday.
The Independent (Associated Press),
The fall went on the next day. On Friday the S&P 500 lost 1.8% to 7,580.21 by early figures, and ended October lower even though it set a record during the month. The Nasdaq Composite, an index full of tech companies, fell 2.84%. During the day Intel fell nearly 30% after a weak forecast, and Nvidia fell 3.1%. In one week the Nasdaq lost nearly $1tn in value. To end the year at 8,000 or more, the S&P 500 now has to rise 5.5% from Friday’s close.
Sources: The Independent, BBC (2), The Guardian (2, 3, 4, 5, 6), Federal Reserve
The Pattern
We looked for cases where results from one of the ten biggest US companies sent its shares down at least 5% in a day, and the S&P 500 fell with them, less than two months after a record close. We kept the days when the fall was blamed on spending on a new technology growing faster than the money it brings in. We found five such days since . Four times the index ended that quarter above its close on the day of the fall, but only twice by more than 3.6%, the rise it needed from the close to reach 8,000.
Show the other 3 cases
The Read
Only two of the five past falls ended the quarter more than 3.6% higher: Meta in and Amazon in , both up about 8%. Four ended above the day of the fall, and three set a new record within seven weeks. Today has one thing in common with the fall that ended lower. In Microsoft shares fell 10%, with the index two days from a record. Two months later the war with Iran had pushed oil above $110, and the index ended March 6.3% lower. On oil was at $117.80 for the same reason, and on the Nasdaq closed 2.84% lower, by early figures.
There are reasons for doubt. All five falls happened between 2022 and 2026, and Meta was behind three of them. In the same day also brought weak US jobs figures, so Amazon was not the only reason for the fall. The size of the fall and how far it stood from its record high did not tell which way the quarter ended: the biggest fall, in , still ended the quarter higher. The US central bank meets on 8 and , and two of its 12 voters wanted a rise in October.
Sources: The Guardian (2, 3), CNBC, The Independent, BBC, Federal Reserve
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