Doubts about the financing of the AI boom are putting pressure on tech stocks. At the same time, the rise in oil prices is fueling interest rate concerns. Investors are waiting for the balance sheets of large US technology companies.
Dusseldorf. Concerns about further developments in the technology sector continue to keep investors on Wall Street on their toes.
The Dow Jones of standard stocks rose by 0.3 percent to 52,106 points.
The broadly diversified S&P 500 is trading unchanged at 7,685 points.
The Nasdaq technology exchange fell 0.8 percent to 26,242 points.
The Nasdaq 100, which tracks the 100 non-financial companies with the highest market capitalization, fell by 0.6 percent to 29,342 points.
“Concerns about the high valuations and financing of the AI boom continue to increase,” said Andreas Lipkow, chief analyst at broker CMC Markets.
AI concerns weigh on stock markets
Companies in the semiconductor and data center sectors also came under selling pressure on the Asian stock exchanges on Tuesday.
In Seoul, shares of data center provider Elice fell 32 percent after its stock market debut. “Investors are increasingly questioning whether the huge investments made by large technology companies can actually pay off in the foreseeable future,” said Lipkow.
US cloud provider Coreweave is also losing more than six percent. Investors are waiting for results from large AI investors like Meta to get information about the further development of the billion-dollar investments.
Concerns about financing AI infrastructure are also evident in the bond market. Softbank Group's credit risk rose to its highest level in almost four years. According to Cavendish's Roger Lee, the market needs evidence that the huge investments in data centers and infrastructure are paying off. Cloud infrastructure providers that are particularly heavily indebted could come under further pressure.
Balance sheets tip the scales
Investors are focusing on the company's annual reporting season. “The outlook is likely to be crucial for a change in sentiment: convincing growth prospects and resilient profits could strengthen confidence,” said Salah-Eddine Bouhmidi from broker IG. With regard to AI concerns, the focus is on the business development of US technology giants such as SpaceX, Meta and Tesla.
SpaceX and Tesla will publish their quarterly figures within two days. SpaceX on Tuesday, Tesla on Wednesday, each after the US stock market closes.
“A possible merger between the two companies is currently making headlines on Wall Street,” says Maximilian Wienke, market analyst at Etoro. “SpaceX could provide Starlink and the AI infrastructure, while Tesla contributes the physical platform with cars, robotaxis and humanoid robots.” Together, a comprehensive AI value chain would be created.
Higher energy prices are fueling concerns about interest rate increases
At the same time, the price of oil rose to its highest level in five months: Brent for delivery in December exceeded the $111 per barrel mark (around 96 euros) for the first time since May. Traders weigh the risk of further Iranian attacks on the Strait of Hormuz.
“The rise in the price of Brent oil towards $110 per barrel shows how strongly geopolitical risks are currently influencing pricing again,” says Daniela Hathorn, senior market analyst at capital.com. At the same time, the reaction on the markets is increasingly inconsistent: “US technology stocks are showing resilience, while European assets are also suffering from fiscal and political concerns.”
Oil prices had already risen on Monday. Higher energy prices are fueling expectations that the US Federal Reserve could keep interest rates at high levels for longer to curb inflation.
Look at the individual values:
3M: The US group 3M exceeded Wall Street's earnings expectations in the third quarter and raised its annual forecast for the second time in a row. The maker of Post-it notes and Scotch tape now expects full-year adjusted earnings of $9.10 to $9.15 per share, up from its previous forecast of a maximum of $8.95. Analysts on average had expected $8.94. The shares rise by four percent.
Amazon: The online retailer said it will invest more than 16 billion euros ($17.9 billion) in Germany next year in areas such as data centers, satellite programming and Prime Video media production. The papers fall by 0.6 percent.
Salesforce: Salesforce is buying the marketing software provider Braze for around $5.7 billion. Completion is scheduled for the 2028 financial year. Salesforce shares are losing around 0.7 percent.
