Nasdaq falls 2.1% and has its worst week since June due to AI debt
WHAT HAPPENED
The Nasdaq fell 2.1% on Friday and 4.5% for the week, its worst performance since June. The concern: companies building data centers for AI have accumulated a lot of debt. CoreWeave owes nearly $50,000 million and its loans reached nearly 15%.
WHY IT MATTERS
High inflation and oil prices near $110 per barrel increase the risk that the Federal Reserve will keep rates elevated. This makes debt more expensive, first hitting technology and semiconductors, while benefiting energy companies when oil prices rise.
AND FOR YOUR PORTFOLIO
If your savings, fund, or retirement plan has U.S. technology stocks, that part may have lost between 2% and 4.5% this week. This episode shows that the AI boom depends not only on selling more: it also relies on being able to pay the debt that finances its data centers.
💬 TELL IT LIKE THIS
“Artificial intelligence is growing with debt, and high rates are testing how much that growth can withstand.”