Global stocks rose as tech bounced back from an AI stock rout. Seoul and Tokyo closed the week higher, lifted by chipmakers SK hynix and Kioxia.
Both chipmakers were pummelled on Thursday as investors bailed out of the artificial intelligence sector. European markets, which feature far fewer tech giants than their Asian and US peers, rose in midday deals.
Why Did CoreWeave’s Debt Spook the AI Trade?
**CoreWeave** saw its market value tank 15.5% on Wednesday as yields on some of its bonds soared. The New Jersey cloud infrastructure provider borrowed heavily to buy pricey semiconductor chips from Nvidia.
Nvidia chief Jensen Huang defended the company on Thursday, saying its situation was improving. CoreWeave’s shares climbed almost 6% in response.
Susannah Streeter, chief investment strategist at Wealth Club, said “the strings have been pulled back to the AI trade”. She credited Huang with calming fears about whether the mega spending on infrastructure will reap enough rewards.
What Did Fed Chief Warsh Say About the AI Boom?
Speaking at the IMF and World Bank meetings in Bangkok, Warsh called AI the “most consequential change” to the global economy in his lifetime. He said the AI investment boom would drive prices up in the short term.
He also warned the path would be “very bumpy”, because “we really don’t know what the market structure is going to be of these new technologies”. He still sees “a huge benefit to the global economy, to the US economy over the horizon”.
Why Did the Jakarta Stock Market Plunge More Than 11%?
The Jakarta stock market tanked more than 11%, its heaviest loss since 1998. Index compiler MSCI said it was “no longer appropriate” to maintain Indonesia’s emerging-market status.
The decision fuelled fears of an exodus of foreign investment from Indonesia. Investors may want to watch whether that concern spreads to other emerging markets.
Where Did Key Indices Close This Week?
- Dow (New York): up 1.1% to 52,177.69 at close
- Hang Seng Index: up 0.5% to 24,186.83 at close
- Shanghai Composite: up 0.2% to 3,716.28 at close
- FTSE 100 (London): up 0.1% at 10,849.95
- CAC 40 (Paris): up 0.4% at 7,967.05
- DAX (Frankfurt): up 1.0% at 25,640.45
- Brent North Sea crude: up 0.3% at $106.19 per barrel
- West Texas Intermediate: down 0.4% at $97.62 per barrel
Is Bursa Malaysia Exposed to the AI Stock Rout?
The source names no Bursa Malaysia-listed company, so no stock code or ringgit figure applies here. Malaysian holders of AI-linked names can screen the sector with tools such as AI Stock Analysis for Malaysians.
Disclaimer: This article is for general information only and is not financial advice. Do your own research before making any investment decision.
Key Takeaways
- CoreWeave’s market value fell 15.5% on Wednesday, then its shares rose almost 6% after Jensen Huang’s defence.
- Kospi closed up 2.1% at 5,668.05 and Nikkei 225 closed up 1.4% at 65,324.29.
- Warsh expects a “very bumpy” path for AI, despite a “huge benefit” over the horizon.
- MSCI’s Indonesia decision sent the Jakarta stock market down more than 11%, its heaviest loss since 1998.
Frequently Asked Questions
Why did CoreWeave shares fall 15.5%?
CoreWeave’s market value fell 15.5% on Wednesday as yields on some of its bonds soared. Markets worried about its huge debt pile, which financed heavy purchases of chips from Nvidia.
Why did the Jakarta stock market fall more than 11%?
MSCI said it was “no longer appropriate” to maintain Indonesia’s emerging-market status. That fuelled fears of an exodus of foreign investment, causing the heaviest loss since 1998.
Did the Kospi and Nikkei 225 close higher?
Yes. The Kospi rose 2.1% to 5,668.05 and the Nikkei 225 rose 1.4% to 65,324.29 at close, boosted by SK hynix and Kioxia.
Does the AI stock rout affect Bursa Malaysia stocks?
The source does not name any Bursa Malaysia-listed company, so it gives no direct impact figures. Check each company’s own filings on Bursa Malaysia and do your own research.
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Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research before making investment decisions.
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