As tech swoon roils market, US inflation data on tap
SPY•US stocks fell sharply as worries about the AI data-center buildout hit technology shares, with the Nasdaq closing nearly 12% below its October 6 peak. Investors face Tuesday’s October CPI report and earnings from CoreWeave, Applied Materials and Cisco next week.
1. Tech shares sell off
US stocks were jolted by steep selling in AI and technology shares after concerns that midterm election results could slow the data-center buildout. The S&P 500 technology sector fell 7.3% on Thursday, while the Philadelphia Semiconductor index dropped more than 12%; both posted their biggest one-day declines in more than six years. The Nasdaq closed nearly 12% below its October 6 record high.
2. CPI and rate expectations
The government is scheduled to release October consumer price index data on Tuesday. Investors are looking for clues about the Federal Reserve’s rate path; futures indicated about a 65% chance of a rate hike at the December 8-9 meeting, despite a modest pullback in those bets on Thursday.
3. Tech earnings ahead
CoreWeave, Applied Materials and Cisco Systems are due to report earnings next week. CoreWeave is at the center of concerns about financing the AI buildout, and its shares have been pummeled in recent weeks.
