{
  "id": 14521752,
  "title": "US stocks: AI shares tumble, erasing $80 billion as hot US inflation fuels rate fears",
  "url": "https://urgent.news/2026/10/14/us-stocks-ai-shares-tumble-erasing-80-billion-as-hot-us-inflation",
  "topic": "ai",
  "section": "AI",
  "published": "2026-10-14T18:52:22.000Z",
  "source": {
    "name": "The Economic Times - Top News",
    "slug": "the-economic-times-top-news",
    "url": "https://economictimes.indiatimes.com/markets/us-stocks/news/us-stocks-ai-shares-tumble-erasing-80-billion-as-hot-us-inflation-fuels-rate-fears/articleshow/134950204.cms"
  },
  "original_language": "en",
  "account": "US stocks experienced a significant decline on Wednesday, with AI shares falling sharply and erasing an estimated $80 billion in market value. This decline was triggered by the latest hot US inflation report, which heightened fears about the risks associated with rising borrowing costs. Major AI companies such as CoreWeave, Nebius, Oracle, and Dell Technologies all saw their stocks plummet. CoreWeave, a data center operator, suffered the greatest loss, falling 16%. The overall market sentiment was influenced by both the impact of tightening financial conditions and the outsized gains made by some of the biggest beneficiaries of the AI boom. Barclays downgraded Dell and two other enterprise hardware stocks, citing that Dell shares had quadrupled this year, which is part of an AI-driven investor frenzy resulting in 16 stocks in the S&P 500 technology sector at least doubling this year. Concern over rising borrowing costs weighed on other big decliners, with CoreWeave being particularly affected. The company has issued $22 billion of bonds and $26 billion of loans, and a bond issued in June with a yield of 9.625% recently yielded 15%. This suggested that the largest AI companies may not be generating the expected earnings or revenue, causing investors to become increasingly nervous about firms like CoreWeave. CoreWeave's CEO, Mike Intrator, maintained confidence in the AI cloud company, dismissing the market's reaction as irrational. This latest market turmoil adds to a growing list of signs indicating that investors are struggling to comprehend the implications of high inflation when AI-fueled corporate borrowing has already led to a surge in global interest rates. While investors generally remain optimistic about the sector due to the profitability and solid management of its largest players, higher interest rates make borrowing and building more expensive, particularly for less-profitable firms. US interest rates rose following the inflation report, with the 30-year yield peaking at 5.63% before easing later in the day. Ross Mayfield, an investment strategy analyst at Baird, warned that long rates above 5% and creeping towards 6% pose a problem for marginal borrowers, making it harder for smaller players in the sector to borrow. The Nasdaq fell 2% on Wednesday afternoon, with Alphabet and other major hyperscalers like Meta, Microsoft, Google, and Amazon mostly down around 2%. SpaceX, another major AI player, saw its stock drop by 3%. Despite the strong economics behind these firms and their investments in data centers, Jed Ellerbroek, a portfolio manager at Argent Capital Management, expressed skepticism about investors' willingness to fully back the AI buildout. This skepticism stems from previous market busts, such as the dot-com meltdown in 2000, and the aggressive spending by a select group of companies on data centers. While these companies are driving most of the growth in the economy and the stock market, investors are being cautious and selective in their approach.",
  "summary": "Amid rising inflation, major AI firms like CoreWeave and Dell Technologies experienced significant stock price drops, losing around $80 billion in market value. Increased US interest rates have investors worried about the borrowing hurdles faced by less profitable firms within the sector. Even with the strong performance of giants like Nvidia and Microsoft, skepticism remains high, reminiscent of…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}