Technology & AI

Wall Street brokerages call AI stock selloff overdone

Major banks say the sharp drop in artificial intelligence shares last week was excessive, as global markets bounce back.

By Standard Topic. AI-generated from the reporting listed under Coverage. Published . Updated .

What happened

Wall Street brokerages including Morgan Stanley, UBS, HSBC and Jefferies called last week's rout in AI-related stocks overdone. They downplayed the risk of extreme regulation of data center developments under a Democrat-controlled Congress. Citigroup strategists then downgraded U.S. equities to neutral, citing ongoing volatility and regulatory concerns.

Why it matters

The selloff erased $3 trillion from the market value of S&P 500 companies, and investors are watching the AI trade closely. Analysts pointed to Anthropic's coming IPO and Nvidia's earnings as likelier catalysts for the sector.

Timeline

  1. Nov 8, 11:54 PM ET: Asian stocks rebounded after the rout in AI shares, which had pushed many indices into bear market territory.
  2. Nov 9, 9:37 AM ET: Morgan Stanley and UBS, among other Wall Street brokerages, called last week's AI trade rout overdone and downplayed Democrat regulation risks.
  3. Nov 9, 2:12 PM ET: Citigroup strategists downgraded U.S. equities to neutral, citing ongoing volatility and regulatory concerns.
  4. Nov 9, 4:05 PM ET: Morgan Stanley, UBS, HSBC and Jefferies concluded the AI stock selloff was overdone and that Democratic regulation fears were overblown.

Coverage

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