Tel Aviv Stocks Brace for Opening After Wall Street's Worst AI-Driven Selloff Since June
Translated & summarized from Calcalist by baba
The Tel Aviv Stock Exchange is set to open lower after New York tech stocks plunged due to AI investment concerns. Nvidia CEO Jensen Huang's remarks about capital shortages and Meta's high financing needs fueled investor fears. The Nasdaq saw its worst day since June, with Tel Aviv chip stocks already showing declines.
The story in 5 lines · by baba
- Tel Aviv stocks expected to open lower after sharp US tech selloff driven by AI investment fears.
- Nvidia CEO Jensen Huang warned of capital shortages impacting AI industry growth.
- Nasdaq Composite suffered its worst decline since June, losing 2.6%.
- Tel Aviv's TA-35 index fell 1.1% and TA-125 index dropped 0.9% on Thursday.
- Tel Aviv chip stocks like Camtek and Tower Semiconductor saw significant drops.
The Tel Aviv Stock Exchange is expected to open its final trading day of the week facing downward pressure, following significant declines in New York technology stocks. The selloff was triggered by renewed concerns over the substantial expenses and investments associated with artificial intelligence (AI) companies.
Nvidia CEO Jensen Huang's recent interview with CNBC highlighted unprecedented demand for cloud services but also pointed to capital shortages hindering industry growth, a statement that unsettled investors. Traders at Wells Fargo noted in a memo that Huang's warning amplified fears that capital and credit markets are nearing their limit for funding risky investments. Meta's comments regarding the immense financing needs of the AI sector also contributed to a shift in its stock performance and exerted pressure on the broader market.
On Thursday, the Nasdaq Composite experienced its worst day since June, dropping 2.6%. The S&P 500 declined by 1.2%, while the Dow Jones closed relatively stable. These declines in chip stocks had already begun to impact the Tel Aviv market, with Camtek falling 5.7%, Tower Semiconductor losing 4.2%, and Nova down 3.6% by the close of trading.
However, in New York, chip stock losses deepened even after the market closed. In Tel Aviv, the TA-35 index fell 1.1%, the TA-125 index retreated 0.9%, and the TA Banks index dropped 0.7%. The TA Insurance index saw a significant fall of 2.1%, while the TA Oil and Gas index managed a gain of 0.9%. The declines in leading Tel Aviv indices intensified in the final trading hours, coinciding with a negative opening in New York's technology stocks.
