Key Highlights

● The Nasdaq-100 fell more sharply than the Nasdaq Composite, which closed at 26,140.03.

● The narrower index is weighted toward a few dozen technology, chip and software giants.

● All 30 PHLX Semiconductor Index members fell, and the index closed at 11,137.29.

● Netflix reports Oct 20, followed by Meta, Tesla and Lam Research on Oct 21.

Two Nasdaq benchmarks, one direction

The Nasdaq Composite closed Friday at 26,140.03, down 572.99 points, according to market data. The Nasdaq-100, which tracks the 100 largest non-financial companies listed on the exchange, fell more sharply in relative terms, though market reports differed on the size of the move.

The gap widened over the week. Market reports indicated that the Nasdaq-100 posted a deeper weekly loss than the Composite, which had its worst week since the period ended June 26.

Concentration explains the gap

The Nasdaq Composite includes several thousand listed companies, among them many smaller financial, health care and consumer names. The Nasdaq-100, by contrast, is weighted toward a few dozen technology giants and fast-growing chip and software firms. On a day when those exact groups were sold, the narrower index was always likely to fare worse.

A published report said investors moved from asking what AI can do to how it will be financed, and that the rotation erased more than $1 trillion from semiconductor and AI-related stocks over the week. Many of the biggest losers are Nasdaq-100 heavyweights.

Chips took the heaviest toll

Semiconductors were at the center. All 30 members of the PHLX Semiconductor Index fell, according to market data, and the index closed at 11,137.29. Nasdaq-100 constituents Arm Holdings (NASDAQ:ARM), Advanced Micro Devices (NASDAQ:AMD), Intel (NASDAQ:INTC), Micron Technology (NASDAQ:MU), Marvell Technology (NASDAQ:MRVL), KLA (NASDAQ:KLAC) and Broadcom (NASDAQ:AVGO) all fell sharply. Seagate Technology (NASDAQ:STX) and Western Digital (NASDAQ:WDC) tumbled as memory and storage stocks sold off on concerns about Chinese competitor CXMT, according to market reports.

Software and platforms followed

Software was hit late in the day. Palantir Technologies (NASDAQ:PLTR) tumbled into correction territory relative to its Oct 9 record, erasing roughly $34 billion to $35 billion in value, according to market reports. Fortinet (NASDAQ:FTNT), Datadog (NASDAQ:DDOG), Zscaler (NASDAQ:ZS) and Atlassian (NASDAQ:TEAM) slid, and Axon Enterprise (NASDAQ:AXON) tumbled.

The megacaps contributed too. Meta Platforms (NASDAQ:META) fell amid concern about debt-funded AI spending, and Alphabet (NASDAQ:GOOGL) declined on data-center borrowing worries. Microsoft (NASDAQ:MSFT) and Amazon (NASDAQ:AMZN) slipped, and Netflix (NASDAQ:NFLX) fell after naming Peter Rice chief content officer and as M Science cut its third-quarter subscriber-add estimate. Nvidia (NASDAQ:NVDA) wobbled, with reports differing on whether it ended lower.

Few places to hide

Only a handful of Nasdaq-100 names bucked the trend, and even those gains were modest by the close. Apple (NASDAQ:AAPL) edged higher after preorders for its $1,999 foldable iPhone Duo sold out within minutes, according to market reports.

Meanwhile, the Composite benefited from smaller listed companies outside tech, including some energy, banking and health care names that held up better. The Dow Jones Industrial Average slipped just 175.28 points to 52,002.41, and the S&P 500 fell 84.62 points to 7,659.44.

One market commentator said the leaders "no longer look like a safe haven."

Nasdaq-100 Reports From Netflix to Intel

The Federal Reserve announces its next decision on Oct 28, with Chair Kevin Warsh saying in Bangkok, "I don't prejudge meetings." Nasdaq-100 earnings arrive in force next week. Netflix reports Tuesday, Oct 20, and Meta Platforms, Tesla (NASDAQ:TSLA) and Lam Research (NASDAQ:LRCX) report Wednesday, Oct 21, alongside Texas Instruments (NASDAQ:TXN). Intel reports Oct 29.