On Monday (Aug. 5), the S&P 500 saw its worst day in two years, falling 3 percent. The Dow Jones Industrial Index and Nasdaq also shed 2.6 percent and 3.4 percent, respectively. The Japanese Nikkei Index, meanwhile, lost a whopping 13.4 percent, logging its worst day since 1987. Investors began dumping shares after last Thursday’s jobs report showed unemployment had risen to 4.3 percent, the highest level since late 2021, fueling worries that the U.S. economy could be backsliding into recession. The “Magnificent Seven” companies (Meta (META), Microsoft (MSFT), Amazon (AMZN), Apple (AAPL), Alphabet (GOOGL), Tesla (TSLA) and Nvidia (NVDA)), which make up roughly a third of S&P 500’s market value, collectively lost $653 billion in market cap in one day, reflecting investor sentiment that Big Tech companies’ A.I. promises that have buoyed the stock market thus far may not be coming to save the day.

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This week’s stock rout followed generally lackluster quarterly earnings from Meta, Microsoft, Amazon, Apple and Alphabet. With the exception of Apple, the other four companies all reported increased capital spending on A.I.........

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