Symbolic imageAI borrowing fears spread from CoreWeave to chips and US banks
Worries about debt-funded AI spending hit CoreWeave shares and bonds and data-centre debt. Big US bank shares are on course for their worst weekly losing streak since 2008.
Reuters reports that CoreWeave shares and bonds are headed for steep weekly losses, and Bloomberg says the stock wipeout exposes a divide between AI fear and greed. The Wall Street Journal reports that US stocks fell on Friday as credit fears weighed on the tech sector. Reuters' Morning Bid had noted a brief calm after the CoreWeave shock and asked how long it would last.
Data-centre debt under pressure
The Financial Times reports that investors are dumping data-centre bonds and abandoned listings are piling up. It says decisions by the Australian groups Firmus and AirTrunk added to concerns about the AI borrowing frenzy.
Chip rout lengthens
Bloomberg says the longest chip selloff since 2006 has earned short sellers $32 billion. On Thursday, 15 October, the rout had reached Asia: South Korea's KOSPI fell 7.6% and Japan's Nikkei nearly 5%, after a US selloff on hot September inflation data and doubts over data-centre profitability.
Banks raise funds
Bloomberg reports that Bank of America tapped the high-grade bond market after a turbulent week.