US Stock Rebound Falters as AI Jitters Return: Markets Wrap
(Bloomberg) — A rebound in the artificial intelligence trade sputtered after the dismal debut of a South Korean data center firm revived concerns about whether the technology’s spending boom can last.
S&P 500 futures swung between gains and losses as a poor reception for Elice Inc. in Seoul sapped appetite for risky assets. The AI-infrastructure provider plunged 32%, suffering the country’s worst opening day for a sizable company. Nasdaq 100 contracts were down 0.4%, halting their day-long recovery.
Treasuries caught fresh haven bids despite climbing oil prices, with 10-year yields dropping two basis points to 5.12%. Brent crude topped $111 a barrel for the first time since May as traders weighed the risk of further Iranian attacks in the Strait of Hormuz. The dollar fell 0.1%.
Elice’s poor reception echoed the AI funding concerns brought to the fore by the abandoned IPO of Australia’s Firmus Grid Ltd. barely two weeks ago. Those worries are also evident in debt markets, with SoftBank Group Corp.’s credit risk rising to the highest level in nearly four years on Tuesday.
“Concerns surrounding AI-related data center and infrastructure investment have been building for several days,” said Roger Lee at Cavendish. “The market probably needs some reassurance that the huge capex investment is generating a return. That is hard to see at the moment.”
Investors are now waiting for results from the biggest AI spenders for clues on how long the vast outlays can continue and at what pace. SpaceX is expected to report after the close on Tuesday, followed by Meta Platforms Inc. tomorrow.
Traders will also want to see whether Netflix Inc. can produce hit movies and TV series again to turn around a $135 billion slide in market value this year.
Tuesday’s risk-off mood extended across regions. MSCI Inc.’s benchmark for Asia touched its lowest level since July, with South Korea’s Kospi index falling 3.7%. US chipmakers were set to resume their downward slide. Industrial goods and services, along with mining stocks, led Europe’s Stoxx 600 0.6% lower.
Markets have already begun to price in a slowdown in earnings growth, said Mathias Heim, chief investment officer at Belle Capital.
“A return to the narrative of ever-higher capex guidance looks unlikely at this stage,” Heim said. “I would expect a period of digestion rather than a sustained rebound: slower growth for AI capex beneficiaries and potentially continued stress for highly leveraged neocloud providers.”
Bond markets, meanwhile, received a boost from record demand at an auction of 20-year Japanese debt. French bonds remained under pressure, with the 10-year yield premium over safer German debt rising to 150 basis points, a level last seen on Oct. 5.
“We see opportunities where higher sovereign bond yields better compensate investors for risk without signaling weaker fundamentals,” the BlackRock Investment Institute said in a note. Yet, the sharp selloff in French government bonds shows “selectivity is key.”
Corporate Highlights:
Amazon.com Inc. said it will invest more than €16 billion ($17.9 billion) next year in Germany for operations including data centers, satellite program and Prime Video media production. Tencent Holdings Ltd., Alibaba Group Holding Ltd. and ByteDance Ltd. have ordered more than 3 million new Nvidia Corp. graphics cards, Reuters reported, citing people familiar with the matter. ABB Ltd. reported third-quarter orders that surpassed expectations after demand for electric components used by data centers and utilities surged. Schneider Electric SE is raising about €6 billion ($6.7 billion) in an offering of new shares to help fund its largest-ever acquisition. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.7% as of 11:10 a.m. London time S&P 500 futures were little changed Nasdaq 100 futures fell 0.3% Futures on the Dow Jones Industrial Average rose 0.2% The MSCI Asia Pacific Index fell 1.3% The MSCI Emerging Markets Index fell 1.3% Currencies
The Bloomberg Dollar Spot Index fell 0.1% The euro was little changed at $1.1218 The Japanese yen rose 0.2% to 158.13 per dollar The offshore yuan was little changed at 6.6772 per dollar The British pound rose 0.3% to $1.3351 Cryptocurrencies
Bitcoin fell 0.5% to $81,466.62 Ether fell 0.5% to $2,386.36 Bonds
The yield on 10-year Treasuries declined one basis point to 5.13% Germany’s 10-year yield declined two basis points to 3.44% Britain’s 10-year yield advanced one basis point to 5.45% Commodities
Brent crude rose 1.5% to $111.23 a barrel Spot gold fell 0.7% to $4,112.84 an ounce This story was produced with the assistance of Bloomberg Automation.
©2026 Bloomberg L.P.
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