NEW YORK (AP) — The latest shudder for stocks in the artificial-intelligence industry pulled markets lower worldwide on Thursday, while oil prices hit their highest levels since May on worries about the war with Iran.

The S&P 500 fell 1.2% for its worst day since July, while the Nasdaq composite tumbled 2.6%. The weakness for tech stocks was so overwhelming that it masked strength for the rest of the U.S. market, where the majority of stocks actually rose. The Dow Jones Industrial Average added 11 points, or less than 0.1%.

AI-related stocks have been swinging on worries that their boom may be under threat because of how expensive it’s become to borrow money to build data centers and buy more AI chips. Concerns also remain that their prices shot too high following a yearslong frenzy, even though companies in the industry continue to report growth.

Lam Research, whose equipment and services help make semiconductors, reported gains in profit and revenue for the summer that were slightly stronger than analysts expected, for example. Usually, that helps boost a stock’s price, but Lam Research’s tumbled 11.8%.

It gave a range for its forecast for profit this quarter whose midpoint was slightly below analysts’ expectations. Its stock also came into the day with a 52.4% surge for the year so far, nearly quadruple the gain for the overall S&P 500, leaving plenty of room for potential disappointment.

Other big tech stocks likewise fell following quarterly reports that included at least some encouraging nuggets.

Meta Platforms, which is pushing its Muse AI agent, lost 7% after reporting stronger revenue for the latest quarter than analysts expected, though its profit fell short. The company behind Facebook and Instagram also said it’s creating a new class of stock to raise money to pay for AI investments and other expenses.

Tesla fell 3.1% after reporting a stronger profit for the summer than analysts expected, though its revenue was weaker than forecast.

The global tide against AI stocks knocked Nvidia down 4.4%. Because the chip giant is the largest company on Wall Street by total value, movements for its stock carry more weight on the S&P 500 than any other, and it was the single strongest force pulling the index lower.

CoreWeave, which has borrowed money to buy Nvidia’s AI chips that it rents out to customers over the cloud, has been particularly shaky in recent weeks because of worries about its debt. It dropped 10.1%.

The weakness for AI and other tech stocks began in Asia, where indexes are full of players in the industry. South Korea’s Kospi tumbled 3.5%, Hong Kong’s Hang Seng dropped 3% and Japan’s Nikkei 225 sank 2.7%.

Also weighing on global stock markets was a jump in oil prices.

The price for a barrel of Brent crude oil leaped 4% to $113.17 after touching its highest level in five months. It’s shot up from less than $97 at the start of the month on uncertainty about when the war with Iran will allow the global energy industry to return to normal.

In Europe, France’s CAC 40 stock index fell to one of the continent’s sharpest losses with a drop of 1.4%. It has fewer tech stocks than Asian or U.S. indexes, but it was hurt by another jump in yields for French government bonds.

Yields have been generally climbing there because of worries about the government’s big debt load and strained budget. Violent protests across France have raised pressure on the government to increase spending, which could add further to its debt.

Worries about big government debt are weighing on almost every developed economy in the world, including the United States. Such concerns, along with high inflation, signals of a still-strong U.S. economy and other factors, have pushed yields in the U.S. bond market recently to their highest levels in decades.

But U.S. yields nevertheless fell sharply Thursday in a signal that investors were buying U.S. government bonds in search of something safer to own as AI stocks tumbled.

The yield on the 10-year Treasury tumbled to 4.97% from 5.13% late Wednesday and from more than 5.30% earlier this month. That’s a major move for the bond market.

Thursday’s drop in yields came even as another report suggested the U.S. economy may be doing better than economists expected. It said fewer U.S. workers applied for unemployment benefits last week, which could signal that layoffs remain low across the country.

That solid economy has helped U.S. companies broadly to make bigger profits, which is what propelled the U.S. stock market to a record high earlier this month despite the many worries tugging at it. Two out of every three stocks within the S&P 500 rose Thursday, only to get drowned out by the drops for more influential tech stocks.

Procter & Gamble, Lockheed Martin and CSX were among the latest companies to join the list of those topping profit expectations for the summer, and gains for their stocks helped limit the market’s losses Thursday.

CEO Shailesh Jejurikar said Procter & Gamble expects “geopolitical and economic challenges” to continue, but it stood by its forecasts for growth in revenue, profit and other measures for the full year. The stock price for the company behind the Crest, Olay and Oral-B brands rose 5.6%.

All told, the S&P 500 fell 93.74 points to 7,663.43. The Dow Jones Industrial Average added 11.89 to 52,867.98, and the Nasdaq composite tumbled 694.00 to 26,008.86.