Stocks Fall as AI, Oil Risks Spur Flight to Bonds: Markets Wrap
(Bloomberg) — Stocks declined as a jump in oil prices and renewed concerns about the outlook for the artificial-intelligence trade pushed global investors toward the safety of bonds.
Brent crude topped $112 after deadly attacks in Saudi Arabia heightened concerns that escalating Middle East hostilities could hit supply. Meta Platforms Inc. dropped 6% and its credit risk hit a record high as plans to boost capital spending reignited fears that tech giants will issue more debt for AI buildout. The Nasdaq 100 lost 1.6%. A gauge of chipmakers sank 3.5%.
Losses in equities revived the haven status of Treasuries, overshadowing fears about inflationary pressures stemming from elevated energy costs. Ten-year yields fell 10 basis points to 5.02%. In a rush for safety, the Japanese yen and the Swiss franc outperformed most major currencies.
“Tech stocks came under pressure amid renewed AI valuation fears. The rebound in energy prices contributed to the risk-off tone,” said Ian Lyngen at BMO Capital Markets. “Treasuries have emerged as a primary beneficiary as global risk sentiment has come under pressure.”
Meta’s results kicked off a technology earnings season that’s likely to focus on runaway AI expenditures — and attempts by companies to get a return on investment. Alphabet Inc., Microsoft Corp. and Amazon.com Inc., three of the other biggest spenders on AI data centers, are slated to report next week.
Blackstone Inc. President Jon Gray pushed back on the notion that there’s an AI bubble, just days after billionaire Ken Griffin said investors are “almost certainly” in the midst of one.
“When you think about a bubble, you think about building capacity and then hoping the demand comes,” Gray said in an interview with Bloomberg TV Thursday after the firm reported its third-quarter results. “With AI, you’re building capacity, and you’re hoping you can keep up with the demand.”
Elsewhere, Chinese stocks were dragged into a bear market, with $2.4 trillion lost since a peak in May, as a protracted slump in consumption and mounting doubts over the profitability of AI companies turn them into one of the world’s worst performers.
Meantime, French bond stress intensified as a broad flight from risk and the threat of another round of weekend of protests reinforced the country’s status as the weak link in global markets.
The premium on French 10-year bonds over Germany surged, driving the spread to the highest since late 2011, when the euro debt crisis was at a fever pitch and speculation was mounting that the European Union could break apart.
Corporate Highlights:
Meta Platforms Inc. said it has agreed to spend about $825 billion in the future on various leases and contracts, many of them related to computing power and infrastructure for AI. Tesla Inc. pulled back its spending plans after investment last quarter trailed expectations, a notable surprise in a quarter that also saw the firm beat analysts’ profit estimates. American Airlines Group Inc. cut its full-year outlook again and issued a wide range for its fourth-quarter loss target, highlighting how the industry is struggling to predict its performance amid persistently high fuel prices. Procter & Gamble Co.’s sales and profits beat Wall Street expectations, showing the Tide-owner’s limited price hikes that are successfully drawing constrained customers have not come at the expense of earnings. Lockheed Martin Corp. lifted its full-year outlook as the company’s missile systems portfolio was buoyed by rising global defense spending. Some of the main moves in markets:
Stocks
The S&P 500 fell 0.8% as of 9:56 a.m. New York time The Nasdaq 100 fell 1.6% The Dow Jones Industrial Average fell 0.1% The Stoxx Europe 600 fell 0.5% The MSCI World Index fell 0.8% Currencies
The Bloomberg Dollar Spot Index was little changed The euro fell 0.3% to $1.1196 The British pound fell 0.1% to $1.3374 The Japanese yen rose 0.6% to 157.18 per dollar Cryptocurrencies
Bitcoin fell 3.5% to $81,612.93 Ether fell 3.3% to $2,408.51 Bonds
The yield on 10-year Treasuries declined 10 basis points to 5.02% Germany’s 10-year yield declined seven basis points to 3.35% Britain’s 10-year yield declined two basis points to 5.36% Commodities
West Texas Intermediate crude rose 2% to $99.13 a barrel Spot gold fell 2.1% to $4,055.42 an ounce ©2026 Bloomberg L.P.
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