US STOCKS-S&P 500, Nasdaq set for lower open as AI stocks slide on debt concerns

The S&P 500 and the Nasdaq were on track to extend losses on Thursday as fears of a potential hit to artificial-intelligence investments from higher interest rates deepened ‌a rout in AI-linked stocks and fresh data showed building US price pressures. The indexes marked their biggest one-day fall since July on Wednesday after hotter-than-expected inflation data fueled expectations of further interest-rate hikes from the US Federal Reserve, sending tech stocks tumbling.

TSMC, the world's largest manufacturer of advanced chips, also struck a cautious note for 2027 due to macroeconomic uncertainties after ‌reporting its sixth consecutive record quarterly profit, further denting sentiment on Thursday. Reports that AI lab Anthropic reported a 45% surge in third-quarter revenue compared to the previous ‌quarter failed to lift investor spirits.

CoreWeave, a heavily indebted data-center operator in the eye of the recent tech storm, fell another 3.2% in premarket trading following a 15% drop on Wednesday. Cloud computing giant Oracle dropped 1.6% after a nearly 9% fall in the previous session. The companies' bonds also came under pressure, pushing their yields to record highs.

"Investors are increasingly questioning how much future growth is already priced into valuations, ⁠how expansion ​is being financed and when these investments will ⁠generate sufficient returns," Charu Chanana, chief investment strategist at Saxo, said in a note. "The repricing of CoreWeave's debt suggests that investors are becoming less willing to finance AI infrastructure growth at any cost."

The selloff in AI ⁠stocks has pushed investors back to government bonds, with the benchmark 10-year US Treasury yield at a three-week low of 5.0725%. Chipmakers also lost ground, with Nvidia down 1.7%. Micron Technology and Advanced ​Micro Devices dropped 4.3% and 3.1%, respectively.

The broader chips index has lost $1.64 trillion in a more-than-11% slide in the last six sessions, its longest losing streak since ⁠May 2025. At 08:41 a.m. ET, Dow E-minis rose 206 points, or 0.4%, S&P 500 E-minis fell 21 points, or 0.27%, and Nasdaq 100 E-minis lost 355.25 points, or 1.18%.

The CBOE Volatility Index, known as Wall ⁠Street's fear ​gauge, hit a two-week high and was last up 0.63 points at 17.45. Meanwhile, data showed the Producer Price Index rose 6.3% through September, against a 5.3% rise estimated by economists polled by Reuters. Retail sales also rose last month, more than the 0.3% growth that was anticipated.

Markets will now scrutinize Fed Chair Kevin Warsh's speech before the ⁠International Monetary Fund Annual Meeting. The Nasdaq has dropped more than 3% from record highs touched last week, with concerns about higher interest rates and AI spending threatening to ⁠overshadow the third-quarter earnings season, when S&P ⁠500 profits are expected to grow 30.6%, according to LSEG data.

Shares of Rocket Lab dropped 10.4% after the space company said the inaugural launch of its new, larger Neutron rocket was delayed until next year. FMC slid 42% after the agrichemicals company sharply cut its ‌third-quarter outlook, which includes ‌a $625 million-$675 million hit from commercial actions.