US Treasurys gained in what analysts characterized as a flight to safety by investors increasingly concerned over the health of the AI sector and rising oil prices.
Markets have grown worried that Big Tech firms will not make sufficient money to cover their ballooning investments and are running into supply-chain bottlenecks in their huge infrastructure buildout: OpenAI has reportedly lowered its target valuation, South Korean chip giant SK Hynix pulled a planned IPO of one of its units, and an HSBC survey of hundreds of investors showed a majority expect “a meaningful slowdown in AI infrastructure spending” within the next 12 months. Fears the US-Israel war with Iran will resume, meanwhile, saw Brent crude hit its highest since May.
