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Stock Market Declines as AI Bubble Warnings Persist

The S&P 500 fell 0.6% and the Dow dropped 0.7% as concerns over regional banks and trade tensions overshadowed positive news from the AI sector.

Olivia Sharp 2 min read 647 views
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U.S. stocks closed lower on October 16, 2025, with the S&P 500 falling 0.6%, as market volatility continued amid persistent warnings from economists about a potential AI bubble.

A Broad Market Pullback

U.S. stocks closed broadly lower on Thursday, October 16, 2025, with all three major indexes falling as concerns about regional banks and ongoing U.S.-China trade tensions weighed on the market. The S&P 500 fell 0.6%, the Dow Jones Industrial Average dropped 0.7%, and the tech-heavy Nasdaq Composite declined 0.5%. The negative close continued a period of volatility, with the market giving back some of the gains from a rally on Wednesday.

The market's sensitivity reflects a number of underlying investor concerns that persist despite continued optimism around artificial intelligence. These include the massive capital expenditures …

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