Oil Hits $111 as AI Stocks Slide — SkimNews
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- Brent crude rose 2.6% to $111.66 a barrel, its highest level in five months, driven by geopolitical tensions and energy inflation pressures.
- Nvidia fell 2.3%, weighing on the S&P 500 and retirement-linked index funds, as broader AI-related stocks came under pressure.
- CoreWeave dropped 3.8% on investor concerns about its debt load from financing Nvidia chip purchases for cloud leasing.
- Meta declined 5.8% after missing profit forecasts, while Lam Research slid 7.7% on slightly below-expected profit guidance.
- Citadel founder Ken Griffin stated investors are 'almost certainly' in an AI bubble, warning that AI chip prices could collapse if supply outpaces demand.
- The 10-year Treasury yield reached 5.03%, up from 3.97% before the Iran conflict, reflecting heightened risk premiums and monetary policy uncertainty.
- South Korea's Kospi fell 3.52% and entered a volatile phase after its 7.57% 'Black Thursday' plunge on October 15, remaining over 40% below its June peak.
Why it matters: Rising oil prices and Treasury yields are increasing the cost of capital, which disproportionately impacts high-duration assets like tech and AI stocks. With Nvidia alone accounting for a major share of the S&P 500’s weight, its decline—and skepticism from influential voices like Ken Griffin—amplifies sector-wide repricing risks just as inflation data and Fed decisions loom.
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