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US Markets Tumble on AI Debt Fears
24 Jun
Summary
- Nasdaq and S&P 500 closed at over week-long lows.
- Semiconductor stocks declined amid AI spending concerns.
- Traders anticipate a second Fed rate hike by December.
US stock markets experienced a downturn, with the Nasdaq and S&P 500 closing at their lowest points in over a week on Tuesday. The decline was heavily influenced by a significant drop in semiconductor stocks, a sector facing scrutiny over its substantial debt-funded artificial intelligence expenditures.
Investors are also bracing for a potentially more aggressive interest rate policy from the U.S. Federal Reserve. Market participants are now factoring in a greater probability of a second interest rate hike by December, signaling a shift towards hawkish monetary policy. Upcoming economic data, including the Personal Consumption Expenditures Price Index, will be closely watched.
