Markets in the red: fears over AI bubble, US jobs and geopolitical tensions
Bitcoin slips below $70,000, to October 2024 lows. Gold down below $5,000, silver in free fall. Spread rises slightly above 62 points
by Giorgia Colucci and Ivan Torneo
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(Il Sole 24 Ore Radiocor) - Yesterday's touch-and-go of the Ftse Mib at 47,000 points proved ephemeral for now. In a session marked for the European stock exchanges by new reallies on tech on Wall Street and by some alarming signals on the US labour market, the main index of Milan closed with a loss of 1.7% (at 45,819) and lost 46 thousand points, weighed down by the big banks. Keeping the markets on edge are still fears of the bursting of an AI-related speculative bubble, rekindled by the massive investments in the sector (amounting to 185 billion dollars) announced by Google's holding company, Alphabet. This, while at market close investors await more indications on the health of the tech sector the accounts of Amazon.
Complicating the picture are the latest indications on the US labour market: the report by the agency Challenger, Gray & Christmas in January shows layoffs at their highest and hiring at its lowest since 2009 in the country. Numbers that worry the market as it awaits the employment report on 11 January.
On the European front, today was instead the day of the ECB, which - as widely expected - maintained the status quo on interest rates. President Christine Lagarde reiterated that the institution will maintain a data-driven approach. However, in the future 'a sustained decline in inflation towards 1.5 per cent', Candriam analysts speculate, 'could reopen the possibility of a rate cut by the end of the year'. Instead, a pick-up in growth could 'increase the likelihood of a hike'. The other Old Continent stock exchanges were also in the red: Paris -0.3%, Frankfurt -0.6%, Amsterdam -0.5%, Madrid -2.1% - the worst with the banks -, and London -1%.
Wall Street closes down, DJ -1.20%, Nasdaq -1.59%
On Wall Street, tech remains under pressure. Alphabet Class A slips despite accounts above estimates, penalised by new investments announced on artificial intelligence at a time of market doubts about the new technology. Qualcomm on the other hand pays for a weak outlook linked to a shortage of memory chips. A script reminiscent of what we saw last week on Microsoft Corp, reinforcing the idea of amarket increasingly sensitive to AI costs.
Wall Street closed negative. The Dow Jones lost 1.20 per cent to 48,908.17 points, the Nasdaq gave up 1.59 per cent to 22,540.59 points and the S&P 500 dropped 1.23 per cent to 6,798.10 points.
