By Chibuike Oguh and Elizabeth Howcroft
NEW YORK/PARIS, Oct 16 (Reuters) – Global stocks fell slightly on Friday as markets stabilized after a sharp tech-driven sell-off, while the dollar headed for a weekly loss.
Markets were rattled this week by concerns about rising interest rates and debt-fueled financing behind the AI boom, triggering a selloff in technology and microchip stocks.
Traders increased their bets on further U.S. rate hikes after stronger-than-expected inflation data was released on Wednesday, while investors rushed to Treasuries and other government bonds.
On Wall Street, the benchmark S&P 500 and the Nasdaq ended lower and posted weekly losses. The Dow Jones also fell after reversing early gains, but still posted a weekly gain.
Technology and communications services led losses, while the biggest gainers were utilities and energy stocks.
Shares of CoreWeave have lost 12% and about 25% this week, amid growing investor scrutiny over funding the massive buildout of AI infrastructure.
The Dow Jones Industrial Average fell 0.34%, the S&P 500 lost 1.09% and the Nasdaq Composite fell 2.1%.
The MSCI World Equity Index lost 0.40% and posted a weekly loss.
European stock indices, less hard hit by Thursday’s sell-off, rose, with the STOXX 600 gaining 0.72%. London’s FTSE 100 rose 0.38%. Both indices ended the week higher.
“We’re starting to see cracks in data center financing because you don’t really know who the winners are going to be,” said Tom Plumb, portfolio manager at Plumb Balanced Fund.
“We think there will be some really big winners,” he said. “But you have to be careful about financing capacity, because companies don’t have problems because their assets don’t exceed their liabilities. They have problems when they have liquidity problems.”
Asian stocks mostly rose and bond markets stabilized, with investors reversing some of the previous session’s trends.
Indonesian stocks suffered their biggest decline since 1998 after index provider MSCI said the country’s market no longer merited emerging market status and outlined plans to remove it from major indexes tracked by funds.
FALL OF THE DOLLAR
The dollar index fell 0.26% and was on track for its first weekly decline after four weeks of gains as falling Treasury yields reduced the currency’s appeal. New concerns over AI could push the dollar further down, analysts say.
The euro rose from its recent 17-month low. It was last up 0.16% at $1.1238.
The Japanese yen rose 0.01% against the greenback to 157.98 per dollar.
Gn bussni
