US stocks rebounded in early trading on Wednesday, with the Nasdaq 100 rising 2.4 percent and the S&P 500 gaining 1.1 percent. The gains recovered part of the tech sector’s losses from the previous week, when the Nasdaq 100 fell 4.9 percent.
CoreWeave shares rose 23 percent after the company’s revenue beat analyst estimates. Nvidia gained 3.9 percent, a partial recovery from a 5.5 percent drop the previous Tuesday.
Doubts over AI spending
Tech stocks had sold off the previous week amid concerns about the scale of AI investment and whether that spending can be turned into profit. CoreWeave shares had halved since the summer, with investors questioning how AI infrastructure is financed with debt.
Democrats’ decisive win in US Congressional elections also raised fears of possible restrictions on US data centre development. Those concerns weighed on the sector alongside the spending doubts.
Strategists split on the outlook
Arun Sai, senior strategist at Pictet, said investors were swinging between seeing the sector as a once-in-a-generation buying opportunity and a classic valuation trap. Manish Kabra, US equities strategist at Société Générale, said the market had started pricing in a slowdown in AI that has not yet begun.
Caroline Shaw, portfolio manager at Fidelity International, said the real question was whether to return to technology stocks. Roger Lee, head of equity strategy at Cavendish, said the trend could continue as long as funding remains available.
Dollar and listing news
The dollar rose more than 1 percent against a basket of major currencies over the last two sessions, reaching its highest level since April 2025. US inflation data above expectations reinforced bets on a Federal Reserve rate hike next month.
The Financial Times reported that banks preparing Anthropic’s listing were considering a valuation of USD 1,500 billion or more. Nvidia’s earlier decline followed CEO Jensen Huang’s acknowledgement of a relationship with a woman US authorities suspect is a Chinese spy.
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