As views spread that the excess in AI stocks has unwound, data-center regulation and CoreWeave's earnings have emerged as the biggest focal points for the US equity market. CPI and PPI data are also due this week, and the market's reaction will be closely watched.
AI stocks fell sharply last week as concerns grew over capital spending on AI data centers following a landslide Democratic victory in the midterm elections. Stocks supplying components for data centers and semiconductor stocks declined, while NVIDIA extended its losses. Although there were periods when prices recovered substantially from their highs at the start of the month, concerns over the collapse of the AI bubble affected the market as a whole.
This week, CoreWeave's earnings announcement is being viewed as the biggest hurdle. The company carries substantial debt, and the market will focus on its debt refinancing plans and the outlook for leasing out computing capacity at its data centers. Although the market sees a low likelihood of NVDA providing full support, the possibility of a behind-the-scenes bailout could also influence market trends.
While energy-related stocks rebounded at times on expectations for the Democratic Party's renewable-energy policies, whether pessimism toward AI stocks generally intensifies ahead of CoreWeave's earnings is expected to be the key turning point. With October CPI and PPI data also due, the market is watching future interest-rate trends and economic indicators.
CPI data and CoreWeave's earnings are scheduled for the 10th, employment-related data for the 11th, and AMAT and CSCO earnings announcements for the 13th. Whether the rebound in AI stocks continues is expected to depend on the earnings results and developments in the company's debt response.