The technology-heavy Nasdaq 100 index is attempting to stabilize following a significant sell-off. Futures pointed to a modest 0.2% gain early Thursday, offering a potential respite after the benchmark logged four consecutive losing sessions. This included a sharp 1.81% decline on Wednesday, driven by growing market skepticism over the sustainability of massive artificial intelligence infrastructure investments.
A Failed Financing Deal Triggers Sector-Wide Jitters
Market concerns crystallized around news of a collapsed $10 billion deal. Reports indicated that Blue Owl Capital withdrew from financing an Oracle data center project. The announcement sent shockwaves through related equities: Oracle shares plummeted 5.4%, Broadcom declined 4.5%, and Tesla dropped 4.6%.
This event prompted broader questions about whether the trillion-dollar rush to fund AI development is encountering financial limits. The reaction was widespread, with sector bellwether Nvidia falling 3.8% and Alphabet losing 3.2%. Elevated trading volumes suggested institutional investors were actively reducing their positions.
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Micron Technology Bucks the Trend with Strong Forecast
Amid the pressure on semiconductor stocks, Micron Technology provided a notable counter-narrative. The memory chip manufacturer reported earnings that surpassed expectations and issued a current-quarter revenue forecast of approximately $18.7 billion. In pre-market trading, its stock advanced by seven percent. This performance underscores robust ongoing demand for memory chips, irrespective of short-term doubts about broader AI infrastructure spending.
All Eyes on November CPI for Direction
The immediate market trajectory may hinge on the U.S. Consumer Price Index (CPI) report for November, scheduled for release at 2:30 p.m. ET today. Economists anticipate a 3.1% year-over-year increase. The data will likely set the tone: cooler inflation figures could bolster the nascent recovery, while a hotter-than-expected reading would amplify fears that interest rates will remain elevated for an extended period.
Recent comments from Federal Reserve Governor Waller had suggested potential room for additional rate cuts. However, bond yields have moved higher, creating a headwind for growth-oriented technology valuations. From a technical perspective, the Nasdaq 100 is currently testing a key support level that has held for the past three weeks.
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