Stocks Fall From Record on Broadcom Miss, Oil Dips: Markets Wrap

(Bloomberg) — Stocks pulled back from record levels after a weak forecast from Broadcom Inc. dented momentum in the artificial-intelligence trade that has driven markets higher this year.

MSCI’s index for Asian shares fell 1.2%, snapping a four-day rally that pushed it to an all-time high. South Korea’s Kospi, a bellwether for AI investments and the world’s best-performing gauge this year, dropped 1%. Nasdaq 100 futures retreated 0.5% as Broadcom tumbled 14% in extended trading after its outlook failed to impress investors.

Asian losses followed a pullback on Wall Street, where the S&P 500 snapped a nine-day winning streak as renewed US-Iran clashes damped risk appetite. European shares were set for losses as well. As sentiment weakened, Bitcoin slid to trade around $64,000, the lowest level since February.

Some relief emerged after the US announced a ceasefire between Israel and Lebanon, helping Brent crude halt a three-day rally and fall almost 1% to about $97 a barrel.

In currencies, the yen strengthened against the dollar as Bank of Japan officials are set to consider a quarter percentage point increase to the benchmark interest rate this month and see the possibility of a further rate hike later this year, according to people familiar with the matter.

Broadcom’s disappointing outlook is testing the durability of the AI rally that has driven global equities, especially semiconductor stocks, to record highs. At the same time, renewed geopolitical tensions and persistent concerns about higher-for-longer interest rates are also weighing on sentiment.

“Chip stocks had already run hard into the print, and investors sitting on large gains don’t need much of an excuse to take some off the table,” said Billy Leung, an investment strategist at Global X Management.

The rally in AI stocks paused on Wednesday as the risk-on mood started to dissipate. UBS Group AG’s basket of AI winners fell 1.4%, snapping a four-session winning streak.

Broadcom also signaled its efforts to gain ground in the burgeoning industry are going more slowly than anticipated. Though the company is making headway in pivoting to AI customers, it’s up against outsized investor expectations.

Some investors also warned that the booming AI market is showing signs of a bubble that will eventually burst.

“All great technology changes produce bubbles,” billionaire investor Ray Dalio, the founder of Bridgewater Associates, said in a Bloomberg Television interview Wednesday.

Elsewhere, the dollar was a touch weaker against most of its Group-of-10 peers. Gold rose 0.6% to about $4,460 an ounce as dip buyers emerged.

In Asia, the Indonesian rupiah weakened to the psychological level of 18,000 per dollar, putting investors on watch for a stronger response from the central bank.

Elevated oil prices and signs of resilience in the US labor market sent Treasuries lower Wednesday, as traders increased bets that the Federal Reserve’s next move will be to raise interest rates. Bonds gave up some of those losses Thursday with the Treasury 10-year yield falling two basis points to 4.48%.

Meanwhile, data showed US companies added the most jobs since January 2025, suggesting hiring momentum remains intact despite higher energy costs. If confirmed by Friday’s payrolls report, the figures may reinforce expectations that the Fed is more likely to raise rates in the months ahead.

Investors will get another read on the labor market on Thursday with weekly jobless claims, ahead of the government’s monthly employment report on Friday.

Fed Bank of Dallas President Lorie Logan said policymakers may need to raise rates later this year to bring inflation back to target. Separately, New York Fed President John Williams told Yahoo Finance that the outlook for rates remains uncertain.

“If incoming US data continue to surprise positively, investors may increasingly express a more hawkish Fed view through renewed dollar strength, particularly against lower- and zero-yielding currencies and commodities like the Japanese yen and gold,” said Fawad Razaqzada at Forex.com.

Corporate Highlights:

Taiwan Semiconductor Manufacturing Co. Chief Executive Officer C.C. Wei said the company’s global chip supply will fall short of AI-fueled demand for years to come, sustaining revenue growth for the firm. Alphabet Inc. upsized its equity raise to $84.75 billion from the $80 billion it announced just two days earlier in a bid to help fund growing AI spending plans. Meta Platforms Inc. is selling businesses access to an AI agent for the first time, its latest effort to generate revenue to offset the company’s hefty investments. JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon plans to discuss the upcoming SpaceX initial public offering with thousands of the bank’s high-net-worth clients this week. Some of the main moves in markets:

Stocks

S&P 500 futures fell 0.3% as of 1:51 p.m. Tokyo time Japan’s Topix fell 0.9% Australia’s S&P/ASX 200 fell 1.2% Hong Kong’s Hang Seng fell 1.4% The Shanghai Composite fell 0.4% Euro Stoxx 50 futures fell 0.3% Currencies

The Bloomberg Dollar Spot Index was little changed The euro rose 0.1% to $1.1609 The Japanese yen rose 0.1% to 159.86 per dollar The offshore yuan was little changed at 6.7767 per dollar Cryptocurrencies

Bitcoin fell 0.9% to $64,312.09 Ether rose 1.4% to $1,803.53 Bonds

The yield on 10-year Treasuries declined two basis points to 4.48% Japan’s 10-year yield advanced three basis points to 2.670% Australia’s 10-year yield was little changed at 4.92% Commodities

West Texas Intermediate crude fell 0.8% to $95.27 a barrel Spot gold rose 1% to $4,479.64 an ounce This story was produced with the assistance of Bloomberg Automation.

–With assistance from Winnie Hsu.

©2026 Bloomberg L.P.