Wall Street opened lower on Thursday, with Nasdaq leading the losses, as the first round of earnings from Big Tech companies renewed concerns over their huge spending on artificial intelligence. At the same time, oil prices breaching the $100 per barrel levels amid rising tensions in the Middle East also down on market sentiment.Around 9 pm IST, Nasdaq Composite was down 693.08 points, or 2.70%, to 24,997.83. The S&P 500 trimmed 113.34 points, or 1.51%, at 7,385.62, while Dow Jones Industrial Average lost 616.50 points, or 1.18%, to 51,602.08.Investor worries grew after quarterly earnings from Alphabet and Tesla, the first of the so-called “Magnificent Seven” technology companies to report this earnings season, did little to convince markets that their massive AI investments will generate enough returns.Shares of Alphabet fell 6.4% as investors focused on the company’s higher spending plans despite its results.“Alphabet is spending hundreds of billions of dollars as it looks to stay ahead in the AI arms race,” said AJ Bell investment director Russ Mould, as cited by Reuters.“But there is still a healthy degree of scepticism about the ability of these investments to generate a commensurate level of return.”The decline in Alphabet weighed on the communication services sector, which dropped 4.4%, making it the worst-performing sector on the benchmark S&P 500.Tesla shares slumped 12.2% after the electric vehicle maker reported negative free cash flow for the second quarter for the first time in more than two years.Attention is now turning to earnings from other major technology companies due next week, as investors assess whether the large sums being invested in AI are translating into meaningful returns and whether profit growth can support elevated valuations. Markets also came under pressure as geopolitical concerns intensified. After months of focus on the Strait of Hormuz, investor attention shifted to the Red Sea, where Iranian-aligned Houthis, who control areas near the Bab el-Mandeb strait, have opened a new front in the Middle East crisis.US President Donald Trump said he would hold Iran accountable for any attacks by Yemen’s Houthi militants.Brent crude futures touched $100 a barrel, their highest level since late May, reviving inflation concerns.The jump in oil prices pushed interest-rate-sensitive two-year Treasury yields to a 17-month high as traders raised expectations of a Federal Reserve rate hike as early as next week.Markets are now pricing in around a 38% chance of a 25-basis-point increase at the Fed’s July meeting, up from 12% a week ago, according to CME’s FedWatch tool.Fresh economic data also supported expectations that the Federal Reserve could continue focusing on inflation after the number of Americans filing first-time unemployment claims fell sharply last week.Among individual stocks, Texas Instruments fell 3.2% despite forecasting quarterly revenue above estimates. Lockheed Martin gained 11.1% after raising its 2026 sales and profit forecasts, while ServiceNow rose 2% after increasing its annual subscription revenue forecast for the second time.