Nasdaq 100 Forecast: Tech Stocks Slide as AI Investment Fears Hit US Indices

• Microsoft fell over 10% after reporting Azure cloud division slowdown and soft operating margin guidance, marking its worst day since March 2020
• The Tech-Software ETF (IGV) declined 22% from recent highs, entering bear market territory as investors fear AI threatens traditional software business models
• Nasdaq 100 threatens key technical support at the 50-day moving average (25,615), with a breakdown potentially triggering further decline to January low of 25,025

Market Summary: Tech Stocks Decline on AI Investment Concerns

Key Market Movements

U.S. tech stocks declined sharply on January 30, 2026, with Nasdaq 100 futures dropping 0.82% to 25,786.00. The S&P 500 futures fell 0.70% to 6,943.75, while Dow futures decreased 0.68% to 48,837.00. All three major indices were positioned to close lower for the week for the second consecutive session.

Sector Impact

The Tech-Software ETF (IGV) plunged 5.4%, entering bear market territory with a 22% decline from recent highs. Software companies emerged as the session's biggest losers amid growing fears that artificial intelligence could disrupt traditional software business models.

Company-Specific Developments

Microsoft triggered the selloff after falling over 10% in the previous session—its worst single-day performance since March 2020. The decline followed reports of slowing growth in its Azure cloud division and soft operating margin guidance for fiscal Q3. Semiconductor equipment maker KLA shed 8% overnight, while Apple and Sandisk posted strong earnings beats that failed to lift overall market sentiment.

Technical Analysis

The Nasdaq 100 threatens a critical support level at the 50-day moving average of 25,615.39. A breakdown below this threshold could accelerate losses toward the January low of 25,025. The index retreated from a recent peak of 26,349.00, with analysts citing a downtrend line at 25,464.75 as another key level to watch.

Market Implications

Investor concerns center on AI monetization challenges and software sector vulnerability, overshadowing positive earnings results. The bearish sentiment reflects mounting doubts about returns on AI investments across the technology sector.