Asian markets opened lower Monday as investors questioned whether the massive spending on AI infrastructure will deliver enough returns to justify the cost. Japan’s Nikkei dropped 2%, while South Korea’s market fell 1.6%, extending pressure on technology shares.
The concern isn’t that AI demand has disappeared. It’s that building data centers, buying advanced chips, and securing enough power requires enormous capital — while higher bond yields and wider credit spreads make financing more expensive.
There’s a potential lifeline: oil prices eased after the U.S. moved to relax some Russian sanctions. Brent crude slipped 1.6% to around $108 a barrel, helping ease pressure on bonds and lifting U.S. stock futures. 🛢️
Now comes the real test. Investors are looking toward results from major companies including Tesla, Meta, and Netflix this week. Strong earnings and credible AI revenue growth could restore confidence; disappointing results may intensify questions about valuations and spending.
The concern isn’t that AI demand has disappeared. It’s that building data centers, buying advanced chips, and securing enough power requires enormous capital — while higher bond yields and wider credit spreads make financing more expensive.
There’s a potential lifeline: oil prices eased after the U.S. moved to relax some Russian sanctions. Brent crude slipped 1.6% to around $108 a barrel, helping ease pressure on bonds and lifting U.S. stock futures. 🛢️
Now comes the real test. Investors are looking toward results from major companies including Tesla, Meta, and Netflix this week. Strong earnings and credible AI revenue growth could restore confidence; disappointing results may intensify questions about valuations and spending.
