AI stocks extend losses as CoreWeave drops 6% in premarket

AI stocks extended losses Thursday, with CoreWeave down 6% before US trading, while Treasury prices rose and technology futures fell.

Nasdaq 100 futures declined 1.2%, compared with a 0.3% decrease for S&P 500 contracts. Dow Jones Industrial Average futures gained 0.4%, distinguishing the technology-heavy benchmark’s retreat from the broader US market.

CoreWeave faces equity and credit pressure

CoreWeave Inc.’s premarket decline followed a 15% loss Wednesday, when its debt also weakened. The simultaneous declines put both shareholder valuations and borrowing conditions in focus, rather than leaving the pressure confined to equities.

Chipmakers entered Thursday after six consecutive sessions of losses, and an exchange-traded fund following the industry indicated another decline. The selling followed an earlier equity rally, with the durability of AI spending and the returns on that investment central to the market debate.

Adam Crisafulli of Vital Knowledge linked weaker sentiment to the industry’s growth expectations. “In the land of AI, where investors are used to parabolic figures, a slowdown in growth undercuts sentiment,” he said.

That distinction matters for companies seeking additional funding: continued business expansion does not necessarily satisfy investors whose valuations assume faster growth. If financing becomes less accessible, companies dependent on external capital could face tighter spending choices even while demand continues to increase.

Asian chipmakers record steeper declines

South Korea’s Kospi lost 7.6%, exceeding the MSCI Asia Pacific Index’s 2.8% decline. Samsung Electronics Co. and SK Hynix Inc. each fell more than 9%, placing both chipmakers below their domestic benchmark’s performance.

Taiwan Semiconductor Manufacturing Co. declined 2% before releasing quarterly results. Its September-quarter profit exceeded analyst estimates, but margins missed expectations, giving investors different signals about earnings and profitability.

Europe’s Stoxx Europe 600 slipped 0.3%, with technology among the weaker sectors. Ericsson AB moved in the opposite direction, recording its strongest share-price increase since January after quarterly earnings surpassed expectations.

Ericsson cited demand for mobile network equipment in its principal markets, while warning that component expenses would weigh on margins next year. Its results offered a counterpoint to the technology selloff, although the cost warning left a separate profitability risk.

Treasury gains meet the inflation risk

The 10-year Treasury yield fell 10 basis points to 5.09%, its lowest reading in three weeks, as prices increased. German and British 10-year yields also declined, by eight and nine basis points respectively, extending the bond rally beyond the United States.

Other assets showed a mixed pattern: gold gained 1.1% to $4,152.50 an ounce following three declining sessions, while Brent crude lost 2.2% to $103.72 a barrel. Those moves accompanied the equity retreat but do not establish a single explanation for the session.

If lower government yields translate into cheaper corporate borrowing, financing pressure could ease for CoreWeave and the wider AI sector, supporting investment and its contribution to economic activity. If inflation instead prompts further monetary tightening, higher financing costs could constrain company budgets, chip orders and broader investment.

CoreWeave’s simultaneous equity and debt weakness leaves an additional uncertainty: lower Treasury yields alone may not improve its funding terms if investors demand greater compensation for company-specific risk. Subsequent credit pricing, capital-spending plans and chipmakers’ margins would help distinguish a valuation adjustment from a wider investment slowdown.