{"id":73883,"date":"2026-10-30T10:08:25","date_gmt":"2026-10-30T14:08:25","guid":{"rendered":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/intel-plummets-29-as-tech-sell-off-deepens-feds-barkin-warns-of-ai-driven-inflation\/73883\/"},"modified":"2026-10-30T10:08:25","modified_gmt":"2026-10-30T14:08:25","slug":"intel-plummets-29-as-tech-sell-off-deepens-feds-barkin-warns-of-ai-driven-inflation","status":"publish","type":"post","link":"https:\/\/www2.stockmarketwatch.com\/stock-market-news\/intel-plummets-29-as-tech-sell-off-deepens-feds-barkin-warns-of-ai-driven-inflation\/73883\/","title":{"rendered":"Intel Plummets 29% as Tech Sell-Off Deepens; Fed\u2019s Barkin Warns of AI-Driven Inflation"},"content":{"rendered":"<h2>Key Takeaways<\/h2>\n<ul>\n<li><strong>Intel (<a href=\"\/stock\/INTC\">INTC<\/a>) shares plunged 29%<\/strong> on Friday, marking its sharpest one-day decline on record and wiping out over <strong>$100 billion in market capitalization<\/strong> following a weak revenue outlook.<\/li>\n<li><strong>Richmond Fed President Thomas Barkin<\/strong> signaled that the surge in <strong>AI investment is driving demand-side inflation<\/strong>, suggesting the Federal Reserve may need to &quot;lean against&quot; these pressures to reach its 2% target.<\/li>\n<li><strong>US equity markets opened sharply lower<\/strong>, with the <strong>Nasdaq<\/strong> dropping 2.21% and the <strong><a href=\"https:\/\/stockmarketwatch.com\/indices\/sp500\/today\" data-internallinksmanager029f6b8e52c=\"3\" title=\"snp500 today\">S&amp;P 500<\/a><\/strong> falling 1.15% as disappointing tech earnings and manufacturing data weighed on investor sentiment.<\/li>\n<li><strong>The US MNI Chicago PMI for October fell to 55.3<\/strong>, missing analyst estimates of 56.0 and declining from the previous month\u2019s 58.8, indicating a slowdown in regional business activity.<\/li>\n<li><strong>China and Switzerland signed an upgraded free trade agreement<\/strong>, granting Swiss food and goods significantly expanded access to Chinese markets in a move that defies global protectionist trends.<\/li>\n<\/ul>\n<h2>Tech Rout Led by Intel\u2019s Historic Collapse<\/h2>\n<p>Intel (<a href=\"\/stock\/INTC\">INTC<\/a>) shares experienced a catastrophic sell-off Friday, falling as much as <strong>29%<\/strong> to their lowest levels since early 2026. The plunge followed the company&#39;s third-quarter earnings report, where it warned that a <strong>global shortage of AI-related chips<\/strong> is ironically hurting its core PC business by driving up components costs and slowing manufacturer demand. Intel\u2019s fourth-quarter revenue guidance of <strong>$15 billion to $16 billion<\/strong> fell significantly short of the $17.1 billion consensus estimate, leading to the largest single-day market cap loss in the company&#39;s history.<\/p>\n<p>The broader technology sector faced heavy selling pressure as other giants reported underwhelming results. Amazon (<a href=\"\/stock\/AMZN\">AMZN<\/a>) shares fell <strong>5.3%<\/strong> on a weak holiday outlook, while <a href=\"https:\/\/stockmarketwatch.com\/stock\/NVDA\" data-internallinksmanager029f6b8e52c=\"15\" title=\"stock: NVDA\">Nvidia<\/a> (<a href=\"\/stock\/NVDA\">NVDA<\/a>) dropped <strong>2.5%<\/strong>. The <strong>Nasdaq Composite<\/strong> led the market decline, shedding nearly <strong>580 points<\/strong> shortly after the opening bell as investors recalibrated growth expectations for the AI sector.<\/p>\n<h2>Fed\u2019s Barkin Links AI Boom to Inflationary Pressures<\/h2>\n<p>Richmond Federal Reserve President <strong>Thomas Barkin<\/strong> provided a hawkish backdrop to the market volatility, noting that the &quot;enormous AI investment cycle&quot; is creating broad-based cost pressures. Barkin stated that <strong>AI investment is leading to demand-side inflation<\/strong>, a specific type of economic pressure that the Federal Reserve is equipped to &quot;lean against&quot; through its interest rate policy. He emphasized that while the direction of travel for the Fed is toward lower rates, the <strong>pace remains the primary question<\/strong> as businesses plan to pass increased costs on to consumers.<\/p>\n<p>Barkin also highlighted a &quot;surprise&quot; resilience in consumer spending despite flat incomes, but warned that <strong>supply chain pressures<\/strong> from data center expansions are keeping inflation &quot;enduring.&quot; He reiterated the Fed&#39;s commitment to a <strong>gradual approach<\/strong>, suggesting that the central bank will remain cautious in its upcoming meetings to ensure the 2% inflation target remains achievable.<\/p>\n<h2>Manufacturing Slows as Geopolitical Shifts Continue<\/h2>\n<p>Economic data released Friday showed the <strong>US MNI Chicago PMI<\/strong> cooling to <strong>55.3 in October<\/strong>, down from <strong>58.8 in September<\/strong>. While the figure remains in expansionary territory (above 50), the miss against the <strong>56.0 estimate<\/strong> suggests that high borrowing costs and broad cost pressures are beginning to temper industrial activity in the Midwest.<\/p>\n<p>On the geopolitical front, <strong>China and Switzerland<\/strong> finalized an upgraded free trade agreement in Beijing. The deal, hailed by Presidents <strong>Xi Jinping<\/strong> and <strong>Guy Parmelin<\/strong>, will eventually see <strong>99.8% of Swiss exports<\/strong> enter China duty-free. This agreement is viewed as a strategic win for Switzerland, providing &quot;unusually free access&quot; to Chinese markets at a time when the US and EU are increasing trade barriers.<\/p>\n<p>In the US political arena, the <strong>Republican National Committee<\/strong> announced that former President <strong>Donald Trump<\/strong> has rearranged his campaign schedule to replace in-person rallies in <strong>Iowa and Kansas<\/strong> with a &quot;72-hour sprint&quot; of <strong>tele-rallies<\/strong>. The shift is intended to maximize reach across 20 states in the final days before the midterm elections. Meanwhile, the <strong>Kremlin<\/strong> indicated that dates for trilateral negotiations regarding the <strong>Ukraine conflict<\/strong> are being finalized, though Moscow maintains that the timing will depend on the &quot;situation on the battlefield.&quot;<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Key Takeaways Intel (INTC) shares plunged 29% on Friday, marking its sharpest one-day decline on record and wiping out over [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":50383,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center 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