AI Stocks Plunge as US Inflation Report Spikes Yields
AI and technology stocks erased $80 billion in market value Wednesday after a high US inflation report raised fears of higher borrowing costs.
Major AI and technology stocks experienced a significant sell-off on Wednesday, October 14, erasing approximately $80 billion in market value. The rout followed a Consumer Price Index report from the Bureau of Labor Statistics showing prices rose 0.6 percent from August to September, a 3.7 percent year-over-year increase. This data pushed US 30-year yields to a peak of 5.63 percent and intensified pressure on the Federal Reserve to raise interest rates.
CoreWeave saw its stock fall 16% and its 2026 bonds drop to 77 cents on the dollar, signaling severe financial stress for the debt-reliant firm. CEO Mike Intrator responded in an internal memo, stating the market is acting "irrationally" while maintaining confidence in the company's trajectory. Other significant losses included Nebius and Dell Technologies, both falling 11%, and Oracle, which slid 9%.
Adding to the pressure, Barclays downgraded Dell, Hewlett Packard Enterprise, and NetApp from buy to hold. Analysts at the firm argued that recent revenue growth was a function of memory costs rather than a meaningful AI inflection in enterprise spending. While hyperscalers like Alphabet and Microsoft saw smaller declines of around 2%, the broader tech sector suffered, with the Nasdaq Composite dropping 1.9 percent and the Philadelphia Semiconductor Index falling 4.3 percent.
