Asia shares slip, bonds submerged in tide of AI debt
SPY•Asian shares fell as sovereign bond-market strains were compounded by reported plans from major tech companies to raise billions in debt for AI chips. The 10-year Treasury yield reached 5.3019%, near a 24-year high, while Brent crude rose 2.1% to $102.30 a barrel.
1. Stocks retreat as debt concerns grow
Japan’s Nikkei fell 1.1%, South Korea’s benchmark dropped 2.1% and MSCI’s broadest Asia-Pacific index outside Japan lost 1.2%. S&P 500 and Nasdaq futures each dipped 0.1%, while major European stock futures were flat.
2. Tech borrowing plans draw scrutiny
Major technology companies were reportedly seeking billions in financing to buy AI chips. Broadcom was looking for $50 billion in financing, while SpaceX planned to issue $30 billion in investment-grade debt and raise $10 billion in loans to buy chips from Nvidia. Credit default insurance on SpaceX reached record highs, and its shares and bonds lost ground.
3. Yields and currencies move
The 10-year Treasury yield rose to 5.3019% after reaching 5.326% overnight, its highest level in 24 years. The euro traded near a 17-month low at $1.1204 as concerns about France’s finances spread to Italian and Greek debt. Samsung projected a 783% jump in third-quarter operating profit to 107.4 trillion won, but its shares fell 1.2%.
