AI Stocks Slide, Oil Tops $110, Bitcoin Weakens to $81,000 Range
Debt concerns tied to artificial intelligence companies and a sharp surge in crude oil prices are pressuring financial markets. Major cryptocurrencies, including Bitcoin and Ether , also weakened as U.S. technology stocks slumped.As of 11:15 a.m. in Korea on October 17, Bitcoin traded at $81,614 on Binance's USDT market, down 0.67% from 24 hours earlier. It rose as high as $82,940 and fell as low as $80,809 over the past 24 hours, highlighting continued volatility. Ether slipped 0.63% to $2,424.25, while Solana fell 0.74% to $104.66. XRP also dropped 2.02% to $1.3074.On October 16, the Nasdaq Composite closed down 2.15% at 26,140.03 in New York trading. The S&P 500 and the Dow Jones Industrial Average also fell 1.09% and 0.34%, respectively. Bloomberg reported that a semiconductor-sector index fell for an eighth straight session, its longest losing streak since 2008, dropping about 16% over that stretch. The Nasdaq 100 also posted a weekly decline of 5.5%.Heavy borrowing to fund AI infrastructure investment has emerged as a key market concern. Prices for CoreWeave's corporate bonds fell to levels implying about a 60% probability of default. That has deepened doubts about whether AI demand and revenue growth can justify massive data-center investment."The key concern is how much money the hyperscalers are borrowing," Dennis Polmer, chief investment officer at Montes Financial, said. They have exhausted massive cash flow and are now turning to debt, which will create problems ahead, he said.Rising oil prices added to inflation pressure. Brent crude climbed above $110 a barrel intraday as geopolitical tensions in the Middle East and Ukraine persisted. December Brent settled at $109.86, up 3.72% from the previous session, while November West Texas Intermediate closed at $101.41, up 3.51%. Treasury yields, which had been falling on safe-haven demand, faced renewed upward pressure after the spike in crude.In crypto markets, a recovery in spot demand remains a key challenge. Colin Vasco of Coinbase Institutional said the correlation between Bitcoin and semiconductor stocks has fallen to less than half its January peak. Even so, he said spot demand remains too weak to provide solid support for prices.At the same time, some investors continued to view the technology selloff as a buying opportunity. ARK Invest added to its holdings of CoreWeave and Cerebras Systems. Keith Lerner, chief investment officer at Truist Advisory Services, said much of the bad news had already been priced into technology shares and kept an overweight stance on the sector. In the coming earnings season, the main focus will be how much AI revenue growth can offset the burden of investment and borrowing.