stock market falling with the technology sector and the AI market in focus
Nasdaq enters correction and the market debates the future of investments in artificial intelligence after strong volatility.
BY THE X-TRADER NEWS NEWSROOM · REPORTING FROM CNBC MARKETS · 2 MIN
A strong wave of sales hit the financial market recently, generating intense debates among experts about the future of the technology sector. According to CNBC Markets, the bearish movement gained strength after the Democratic victory in the midterm elections on Tuesday.
The main indices suffered significant retractions. According to CNBC Markets, the Nasdaq Composite fell 5% on Thursday, entering correction territory with a pullback of more than 11% from its record high. Over the same period, the Dow Jones Industrial Average saw a drop of more than 1,600 points, while the 10-year Treasury yield reached 4.8%.
The impact was severe on assets linked to innovation and semiconductors. As CNBC Markets found, the iShares Semiconductor ETF plummeted 11% on Thursday, marking the biggest drop since March 2020. The Global X Artificial Intelligence & Technology ETF fell 6% on the day and is down 15% for the month.
The current moment divides opinions about the sustainability of spending in the area. Peter Boockvar, from One Point BFG Wealth Partners, expressed to CNBC Markets questions about the forecast of 1.2 trillion dollars in capex for next year. In the same vein, Eric Johnston, from Cantor Fitzgerald, pointed out to CNBC Markets a significant change in the prospects for AI infrastructure.
On the other hand, managers seek to separate political and macroeconomic noise from corporate fundamentals. Rob Sechan, from Newedge Capital Group, highlighted to CNBC Markets the 48% annual growth in Microsoft's Azure in the third quarter, while Richard Clode, from Janus Henderson, scored positive results for Motorola Solutions and Sony, according to CNBC Markets.
What changes for the investor
The current scenario brings increased volatility to decision-making in variable income, with analysts differing on the nature of the movement. Larry Adam, from Raymond James, assesses that indiscriminate sales represent a buying opportunity, while Victoria Greene, from G Squared Private Wealth, points to solid support observed around the S&P 500, as reported by CNBC Markets, requiring increased attention to fundamentals amid rising interest rates and fiscal and political uncertainties.
Automatically translated from Portuguese.
