Oracle's Earnings Shake AI Investment Confidence

U.S. cloud computing giant Oracle's disappointing earnings have raised concerns about AI profitability, leading to a decline in stocks across Asia and the U.S. Meanwhile, the Federal Reserve's rate cut temporarily boosted Wall Street, but caution remains as markets adjust to mixed signals in the global financial landscape.

Stocks declined on Thursday following an earnings report from U.S. cloud giant Oracle, signaling potential hurdles for AI profitability. The setback in Oracle shares, plunging over 11% after hours, impacted futures on the S&P 500 and Nasdaq 100, reflecting broader market anxieties.

In Tokyo, AI-related stocks faced significant declines, with Oracle's revenue outlook missing expectations and signaling increased spending without immediate returns. This caused repercussions in Japan's Nikkei index and contributed to a drop in shares of SoftBank Group, a major partner in the Stargate data center project.

Despite an initial rally following the Federal Reserve's interest rate cut, concerns linger over the sustainability of investments in AI. As global markets digest these developments, attention turns to upcoming economic indicators and central bank meetings to gauge future financial stability.