This roundup covers Meta's spending plans, China's pressure on Taiwan and other developments. Meta led yesterday's sharp decline in US technology stocks as financing plans revived doubts about whether the debt-financed AI infrastructure expansion is sustainable. Meta shares dropped 7%, erasing about $124 billion in market value. Meta forecast that AI investment would require raising hundreds of billions of dollars over several years, potentially beginning as early as this autumn.
The Nasdaq 100 declined 2.9%. The S&P 500 lost 1.2%. Investors moved into US Treasuries as demand for safe assets increased. Ten-year US government bond yields dropped 0.16 percentage points to slightly under 5%. The Treasury market was heading toward the strongest daily performance since mid-2024. Jon Hill, Barclays' head of US inflation strategy, attributed the rally to possible weaknesses in AI investments rather than recent fundamental economic data.
US technology stocks have experienced repeated volatility since reaching a record in early October. Investors worry that AI share gains and substantial borrowing for data centres and chips have become excessive. In a filing accompanying Wednesday's quarterly results, Meta warned that obtaining capital was becoming more difficult. Rivals including Alphabet are arranging large debt transactions. Anthropic and OpenAI are preparing substantial initial public offerings after SpaceX's stock market debut.
China is applying greater diplomatic pressure to Taiwan and extending maritime "grey zone" activities in waters east of Taiwan. Analysts describe grey zone activities as measures below the threshold of open warfare. Analysts say China is strengthening efforts to separate Taiwan from Taiwan's remaining diplomatic allies.
The roundup also covers India supporting the rupee, with the central bank spending about $90 billion since June from more than $140 billion raised from India's diaspora; Israel voting next week as Prime Minister Benjamin Netanyahu seeks to retain power; and Singapore threatening legal action in recent days against 10 businesses that Singapore's government says caused wildfires in Indonesia responsible for haze.
Meta's AI Spending Plans Spark Market Concerns
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Summary
Meta's AI spending plans have rattled the crypto market, with shares down 7% and $124 billion wiped from its value. The company expects to raise hundreds of billions for AI infrastructure, fueling concerns over debt-driven growth. The Nasdaq 100 fell 2.9%, while the S&P 500 lost 1.2% as investors moved into U.S. Treasuries. The cryptocurrency market also saw a pullback as risk appetite weakened.
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