Global Markets Tumble Amid Fed's Hawkish Stance and AI Concerns

World stock markets suffered significant losses as Federal Reserve officials signaled reticence towards further rate cuts, impacting investor sentiment. Concerns over inflation, AI bubble, and delayed economic data due to the U.S. government shutdown contributed to market instability. Key indices and tech stocks experienced notable declines.

Global stock markets faced a sharp decline on Friday as hawkish comments from the Federal Reserve dampened hopes for a December rate cut in the U.S. Market sentiment was further rattled by concerns over rising tech valuations amid an AI bubble and scant economic data due to the recent U.S. government shutdown.

Major indices from Tokyo to London plunged into the red, with additional pressure on UK markets stemming from budgetary speculation. U.S. stock futures indicated a grim opening for Wall Street after significant losses on Thursday. Investor anxiety mounted as odds for a December rate cut decreased significantly.

The mood among investors turned cautious, with notable sell-offs in tech favorites like Palantir and Oracle, losing around 15% each in recent weeks. Treasury bonds drew bids as investors sought safe havens, while the dollar saw a decrease amid trimming positions. Oil prices rose following geopolitical tensions involving a drone attack in Ukraine.

(With inputs from agencies.)