After a six-month winning streak, investors thought the artificial-intelligence boom was bulletproof. This week proved otherwise as a series of events sent technology and AI-linked stocks into their worst week since April's tariff-driven selloff.

The first warning sign arrived Tuesday, following Palantir Technologies Inc. (NASDAQ:PLTR) 's earnings report — one of the poster children of this year's market rally.

The company handily beat expectations, yet investors took it as an opportunity to cash out after the stock had surged more than 170% year-to-date.

Chart Of The Week: Investors Dump AI Darlings Amid Growing Bubble Concerns

Meanwhile, the prolonged government shutdown once again delayed the release of official labor market data, leaving private-sector reports as the only clue to the state of the U.S. economy — and they weren't encouraging.

The ADP National Employment Report showed just 42,000 new jobs in October, a rebound from September's 32,000 losses but still too weak to signal any meaningful improvement in labor conditions.

Then came the real shocks on Thursday and Friday. Challenger, Gray & Christmas reported that U.S. employers announced 153,074 job cuts in October, bringing total layoffs this year above one million — the worst pace since 2020.

October's job cuts were up 175% from a year earlier, marking the highest October total since 2003, highlighting the growing impact of AI-driven disruptions.

Yet, amid the gloom, one group stood apart: the wealthiest Americans actually reported an improvement in sentiment, highlighting a widening divide in an economy that continues to follow a distinctly K-shaped path.

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