Nasdaq posts worst week since April amid AI rally jitters, US yields slip
The Nasdaq just staged its own version of a reality check, posting its worst week since April as the AI-powered rocketship hit turbulence. Investors’ newfound love affair with artificial intelligence stocks seems to be cooling off, perhaps realizing that even the brightest tech stars can flicker when jitters about valuations and geopolitical AI competition kick in. Meanwhile, U.S. Treasury yields slipping only add to the uneasy market dance, reflecting caution on multiple financial fronts. Profit-taking, recalibrated multiples, and a splash of geopolitical anxiety around China's AI ascendancy turned what was a confident rally into a cautious retreat.
This past week, the Nasdaq Composite fell about 3%, its largest weekly decline since early April, largely driven by concerns over how sustainable the AI stock rally is amid mixed earnings and geopolitical headwinds[2][3]. Chip stocks and other tech-heavy shares bore the brunt of the losses, with investors reassessing previously sky-high valuations following warnings like Nvidia CEO Jensen Huang's caution about China's advancing AI capabilities[2][3]. At the same time, U.S. Treasury yields dipped, reflecting broader economic uncertainty, while the government shutdown lingered, affecting risk appetite. Despite these setbacks, other major indices, including the Dow and S&P 500, showed resilience with late-session gains after positive signs emerged around the congressional impasse[3].
