Stocks Fall on Renewed AI Jitters as Oil Climbs: Markets Wrap
(Bloomberg) — The final stretch of a volatile week on Wall Street saw stocks dropping amid a technology selloff that has left investors questioning the outlook for the artificial-intelligence trade.
A gauge of chipmakers slipped for an eighth straight day — the longest retreat since 2008. The Nasdaq 100 slipped 1.8%. CoreWeave Inc. sank 11% amid worries over whether the massive buildout of AI infrastructure has outrun the ability of companies to get a return on their investments.
Oil topped $100 after a group of US lawmakers introduced a bill to block President Donald Trump’s deal to release more Russian diesel into global markets. Higher energy costs fueled worries about inflationary pressures, dragging down Treasuries.
While angst around funding AI has been building for months, CoreWeave has drawn outsized attention for being an early entrant in the business that has been heavily reliant on the high-yield debt markets to finance its buildout. With bond yields elevated and inflation remaining stubbornly high, the cost of that financing is rising fast.
“This week’s price action suggests the market debate is beginning to shift,” said Fawad Razaqzada at Stonex Trading and Forex.com. “The question is no longer simply how large the AI opportunity can become, but how profitable the enormous investment required to realize it will ultimately be.”
Demand for chips and computing capacity remains strong, but investors also need to see adequate returns on the vast sums being committed to data centers, power generation, networking and other infrastructure. There are some signs these concerns are spilling into credit markets, Razaqzada said.
Why Tech’s AI Borrowing Binge Is Rattling Markets: Explainer
“That creates a difficult combination for the AI trade,” he added. “Higher interest rates reduce the present value of future cash flows, while simultaneously increasing the cost of financing the infrastructure needed to support the next phase of AI growth.”
The biggest tech corporations, known as hyperscalers, are veering toward $1 trillion of annual capital spending, according to Bloomberg Intelligence. Much of that is debt funded. While the biggest tech companies mostly have high-grade credit ratings, fund managers are asking more questions about junk-rated borrowers like CoreWeave.
“The AI buildout has become a major engine of US economic growth,” said Yardeni Research. “But doubts about future returns are pushing up borrowing costs, potentially constraining access to capital and ultimately slowing investment spending.”
Still, the firm notes that hyperscalers’ strong balance sheets and cash flow generation make their spending plans relatively insensitive to higher borrowing costs.
Corporate Highlights:
Tesla Inc. rolled out its Roadster sports car, showcasing a prototype designed in collaboration with SpaceX outfitted with air thrusters that jumped over other vehicles and flipped in midair. Shipping estimates for Apple Inc.’s first folding phone slipped into January within minutes of the company taking preorders on Friday, suggesting that strong demand and short supply will make the $1,999 device challenging to purchase on its Oct. 23 release date or in the near future. ExxonMobil Holdings Corp. is the latest oil supermajor to signal soaring third-quarter refining profits as wars in the Persian Gulf and Russia crippled fuel-making facilities causing prices to surge. Netflix Inc. is replacing its chief creative officer with a veteran TV and film executive, Peter Rice, accelerating efforts to reinvigorate growth and reverse a slowdown in viewers and revenue at the streaming giant. MSCI Inc. adopted new rules that could ultimately push Strategy Inc. out of its global equity benchmarks, potentially triggering billions of dollars in stock sales and adding fresh pressure to the financing model behind Michael Saylor’s vast Bitcoin holdings. Some of the main moves in markets:
Stocks
The S&P 500 fell 0.8% as of 1:01 p.m. New York time The Nasdaq 100 fell 1.8% The Dow Jones Industrial Average fell 0.3% The MSCI World Index fell 0.4% Currencies
The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1218 The British pound rose 0.3% to $1.3314 The Japanese yen fell 0.2% to 158.27 per dollar Cryptocurrencies
Bitcoin fell 0.9% to $81,293.79 Ether fell 1% to $2,426.22 Bonds
The yield on 10-year Treasuries advanced six basis points to 5.12% Germany’s 10-year yield advanced one basis point to 3.43% Britain’s 10-year yield was little changed at 5.37% Commodities
West Texas Intermediate crude rose 3% to $100.88 a barrel Spot gold fell 0.3% to $4,159.07 an ounce ©2026 Bloomberg L.P.
