Asian markets split between AI revival and fears of bigger Fed rate hike
HONG KONG, Nov 11 — Asian stocks diverged today as renewed optimism over the AI trade was offset by forecast-toppi...
Asian markets experienced a mixed reaction on November 11, driven by a mix of optimism surrounding the artificial intelligence (AI) sector and concerns over the Federal Reserve's potential to raise interest rates sharply. Following a sell-off last week due to fears of increased regulation of AI by Democrats, tech stocks showed resilience this week, buoyed by bargain hunting and the belief that the initial concerns may have been overstated.
Additionally, the favorable earnings report from data center operator CoreWeave, which forecasted sales of US$13-13.3 billion for the year, helped alleviate worries about the company's financial health after it faced significant losses due to debt financing speculation.
The positive sentiment was further reinforced by Anthropic's announcement of plans to raise up to US$64 billion in its initial public offering (IPO), suggesting a valuation of up to US$1.4 trillion. This IPO was initially anticipated to be the largest in history, with the potential to indicate the sustainability of the AI spending surge.
CoreWeave's earnings report, revealing a staggering revenue of US$17 billion in the third quarter, up from just US$1.4 billion the previous year, also contributed to the sector's buoyancy. Moreover, Bloomberg reported that OpenAI, the creator of ChatGPT, had reached US$10 billion in quarterly revenue for the July-September period, a 50 percent increase from the previous quarter and a nearly threefold jump year-on-year.
Despite these positive developments, Nvidia, a major player in the chip industry, remained a focal point due to the recent revelation of CEO Jensen Huang's affair with a woman believed to be a Chinese spy. The scandal has led to an FBI investigation, casting a shadow over the firm's operations. Consequently, Asian markets were split, with some investors capitalizing on the AI sector's revival while others remained wary of the potential consequences of a more aggressive Federal Reserve interest rate hike.
Written by urgent.news from Malay Mail's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
