Wall Street saw a decline on Friday as AI stocks plummeted. The S&P 500 fell 1.1%, Nasdaq dropped 1.7%, and Dow Jones gave back 0.5%. Broadcom’s 11.4% tumble led the market lower despite strong earnings, sparking concerns about AI industry profits and financial forecasts.

Investors are questioning the profitability of AI technology spending after Oracle and Broadcom reported bigger profits but saw their stocks plunge. The doubts surrounding AI industry growth are impacting stock performance, with Broadcom and Nvidia taking heavy hits on Friday.

The bond market’s rise in yields to 4.18% added pressure on stocks, discouraging investors from high-priced investments. AI stocks, once the market leaders, are now struggling, while other sectors like Dow Jones are performing better. Despite the rise in yields, investors are optimistic about interest rates.

Wall Street’s optimism about lower rates boosting the economy was evident as stocks of companies dependent on consumer spending rose. Amidst easing oil prices and hopes for easier interest rates, Chipotle, McDonald’s, and Norwegian Cruise Line saw gains on Friday.

Lululemon Athletica recorded a 9.6% jump after beating profit and revenue expectations. The S&P 500 fell 73.59 points to 6,827.41, Dow Jones dropped 245.96 to 48,458.05, and Nasdaq slumped 398.69 to 23,195.17. Stock markets abroad saw modest declines in Europe but gains in Hong Kong and Tokyo.

Read more at Yahoo Finance: Tumbling tech stocks drag Wall Street to its worst day in 3 weeks