Equities: AI fears revive Black Monday jitters - Deutsche Bank
Deutsche Bank strategists highlight renewed volatility in US equities as the anniversary of Black Monday coincides with a sharp late-Friday sell-off in the S&P 500, followed by a rebound in S&P and Nasdaq futures.
As the 39th anniversary of Black Monday coincides with a sharp sell-off in US equities, Deutsche Bank strategists highlight renewed volatility. The S&P 500 experienced a late Friday decline before rebounding, while Nasdaq futures have made up most of their losses. Concerns are centered around AI-related stocks and semiconductors, with credit markets showing distress in those sectors.
The Philadelphia semiconductor index and Nasdaq both declined significantly over the past week. CoreWeave's stock price plummeted -25.21% last week, and their 5-year CDS increased by 225 basis points to 1128bps. Oracle's shares dropped -9.31%, with a 44bps increase in their 5-year CDS. Asia's markets began the week relatively stable, with most Asian indices trading higher.
However, Indonesia's benchmark stock index has fallen over 16% in the last two sessions due to concerns over an MSCI downgrade. AUD/USD rallied for the second consecutive day, while USD/JPY remained defensive near 158.00. Gold prices have held gains but are still below the $4,200 level.
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