---
title: "Tech funds routed as Nasdaq has its worst week since June"
url: "https://etf.net/news/tech-funds-fall-fifth-day-2026-10-16"
published_at: "2026-10-16T21:12:48.979Z"
updated_at: "2026-10-16T22:34:12.531Z"
byline: "ETF.net Research"
---

# Tech funds routed as Nasdaq has its worst week since June

Chip and AI cloud stocks fall as U.S. Crude settles above $100. Equal-weight S&P 500 fund ends week higher.

By ETF.net Research. Published Oct 16, 2026.

Technology funds fell for a fifth straight session Friday and finished their worst week since June, as chipmakers and AI cloud companies extended their slide.

The Invesco QQQ Trust 'ETF:QQQ" fell **2.5%** Friday on heavy volume and closed underwater 5.5% for the week. The Nasdaq Composite fell 2.1% to 26,140.03, and the The State Street SPDR S&P 500 ETF SPY fell 1.1%. The Dow Jones Industrial Average slipped 0.3% to 52,002.41 but closed up 0.7% for the week. Six of State Street's 11 sector funds closed higher.

Stocks opened higher after Federal Reserve Chairman Kevin Warsh gave no hint of an October rate increase. The gains faded in the afternoon while Brent crude touched $110 a barrel for the first time since May.

Chart: **QQQ** fell 5.5%; equal-weight **RSP** rose 0.5%

## AI cloud stocks and memory chips took the losses

Nvidia, the largest holding in QQQ and about a fifth of the VanEck Semiconductor ETF SMH, fell 1.4%. Apple, the second-largest holding in QQQ, rose 0.4%.

The steep Friday losses were in three companies that sell AI computing. CoreWeave, which rents Nvidia-based computing to AI developers, fell **11.9%** to $61.39 and lost 25% for the week. The company loses money and carries about $50 billion of debt, Reuters reported Friday. Its bond due in October 2031 briefly yielded more than 16% on Thursday.

CoreWeave's cost of insuring its debt against default rose past 1,000 basis points this week, a record, according to S&P Global Market Intelligence data cited by Reuters. At that level, a buyer of default protection pays about 10% of the insured amount each year. (A basis point is one-hundredth of a percentage point.)

CoreWeave stock had fallen 15.5% Wednesday after a hotter-than-expected inflation report. BCA Research said that reading set off the selloff because CoreWeave depends on borrowed money to meet future data-center demand. The shares rebounded 5.9% Thursday after Nvidia CEO Jensen Huang told Bloomberg he was optimistic about the company, then fell again Friday.

Nebius Group, an AI cloud company, fell 12%. IREN fell 11%. Investor's Business Daily reported Monday that IREN, a bitcoin miner, has turned toward providing AI infrastructure.

The Bureau of Labor Statistics said Wednesday that September consumer prices rose 0.6% on the month and 3.7% from a year earlier, with energy up 20.4% over the year.

CoreWeave fell 15.5% that day and rose 5.9% on Thursday. Reuters reported it down 4.1% before Friday's open, and the regular session then took the shares to $61.39.

BCA Research, a macro research firm, told Reuters that the inflation reading triggered the sharp selloff in CoreWeave because the business is a heavily indebted bet on future data-center demand. The comment, published Friday morning, before the open, was about that Wednesday decline. BCA added that the rest of technology is, on average, considerably less sensitive to interest rates.

Chipmakers were especially hard-hit. Intel fell 5.8%, Advanced Micro Devices fell 6.0% and Micron Technology, a memory-chip maker, fell 5.6%. The PHLX Semiconductor Index fell 3.8% for its eighth straight decline and lost 11.4% for the week, its worst week since April 2025, CNN reported. The VanEck Semiconductor ETF SMH fell 3.4% Friday and 10.5% for the week.

AMD gave SMH a bigger haircut than even Nvidia, despite a much smaller weighting in the Index. And together, Micron and AMD accounted for nearly half a percentage point of the drop in QQQ.

Morningstar reported Tuesday that memory shares were already under pressure after reports about CXMT, a Chinese chip firm. The firm's president said CXMT plans to roll out a new memory-chip structure by the end of 2026, Morningstar wrote. Analyst Jing Jie Yu said the announcement had disrupted expectations around development timelines and raised fears of lower-cost Chinese competition.

The State Street Technology Select Sector SPDR ETF XLK fell 3.0%, its largest one-day decline in 31 sessions, and its fifth straight loss.

BlackRock's iShares Russell 2000 ETF IWM, a small-cap fund, fell 1.7%.

## Warsh gives no October signal

Federal Reser Reserve Chairman Kevin Warsh, speaking at the International Monetary Fund and World Bank annual meetings in Bangkok, declined to say whether the Fed will raise rates again at its Oct. 27-28 meeting. “I don’t prejudge meetings,” he said. The Fed raised its benchmark rate a quarter point in September, to a range of 3.75% to 4%, its first increase since 2023.

Investors took his comments as a sign the Fed will hold steady this month. CME FedWatch, which converts fed funds futures prices into odds for each meeting, put the chance of no change in October at about 86% Friday morning, up from about 55% Wednesday, ABC News reported.

However, futures traders still expect an increase by year-end. CME FedWatch put the chance that the Fed’s target range will be higher after its Dec. 8-9 meeting at 91% as of 6:16 a.m. ET Friday, up from 84% a week earlier.

The Labor Department said Wednesday that consumer prices rose 0.6% in September and 3.7% from a year earlier, with energy up 20.4%. Core prices, which exclude food and energy, rose 2.6%, up from 2.4% in August. The Fed’s quiet period, when officials don’t discuss policy, starts Saturday and runs through the meeting.

## Oil rose again as attacks continued in the Strait of Hormuz

Oil reversed its morning losses to close up strongly for the day. Brent crude futures for December delivery settled up 3.7% at $109.86 a barrel, the highest settlement since May 19, after touching $110 during the session. U.S. West Texas Intermediate crude for November delivery settled up 3.5% at $101.41, its highest since Sept. 17, and gained 10.4% for the week, Reuters reported. The United States Oil Fund (USO), which holds WTI futures, rose 2.8% for its seventh straight gain and rose 9.1% for the week.

Energy Aspects, a research firm, said prices turned higher on rumors of attacks on Saudi energy infrastructure. A Saudi-led coalition said it intercepted a ballistic missile fired toward Yanbu, the Red Sea port Saudi Arabia uses to ship crude without going through the Strait of Hormuz.

Higher oil prices drove the State Street Energy Select Sector SPDR ETF XLE up 2.5%, the best performing of State Street's 11 sector funds for the day.

The State Street Utilities Select Sector SPDR ETF XLU gained 1.4%, and the State Street Consumer Staples Select Sector SPDR ETF XLP gained 1.1%.

Chart: **Energy** led; technology took the largest loss

USCF's United States Oil Fund, LP USO, which holds WTI crude futures, rose 2.8%. That was a seventh straight gain, and 9.1% over five sessions. The run began Oct. 8.

Chart: **USO** booked a seventh straight gain

Brent crude, a different benchmark from the futures USO holds, was at $109.76 as of 4:35 p.m. ET, up 3.6% from the prior settle, more than USO rose.

The United States and Israel have been at war with Iran since late February, and the fighting has repeatedly hit shipping in the Strait of Hormuz, the route for Gulf crude. This week's attacks added to that. U.S. Central Command said an Iranian projectile struck the Singapore-flagged container ship GFS Pride, which then sank.

Kpler, a firm that tracks commodity shipments, reported that Iranian strikes on tankers in the strait had driven oil flows sharply lower. It put the daily average in the week to Oct. 13 at 11.62 million barrels a day, against a baseline of 17.15 million barrels a day.

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