AI Chip Stocks Bounce After Global Rout—But Is the Bubble Starting to Burst?
AI-related stocks rebounded Friday after sharp losses, but major indexes remained down for the week and below recent peaks. The selloff reflects concerns about stretched valuations, expensive borrowing, aggressive data-center investment and possible local opposition to new facilities. A slowdown in customer demand could hurt AI-cloud operators, chip orders, contractors and lenders. Unlike many dot-com-era firms, major technology companies funding AI are profitable, while smaller, debt-dependent providers may be more vulnerable. Rising default-insurance costs for CoreWeave signal strain in riskier AI financing, but broader bond markets showed no clear systemic crisis. Upcoming company results and inflation data may help distinguish a market correction from deeper weakness in the AI investment boom.
