Nasdaq falls 1.2% as AI sell-off deepens on inflation and Fed rate fears

Impact · against what's priced in

The AI sell-off is transitioning from a valuation correction to a systemic risk as rising producer inflation and record-high bond yields for infrastructure players threaten the financing of AI growth. While defensive rotations into WMT and MRK are marginally positive, the chip sector faces a new threat: the potential for higher borrowing costs to compress the long-term earnings power the market was already skeptical of.

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Challenges what's priced in

The price assumes