Bold truth: AI hype clashes with real earnings, and one big name after another is selling off despite solid results. The sell-off in artificial intelligence stocks continued Friday in the U.S., with Broadcom shares dropping over 11% after traders weighed lower margins and uncertain deals. The mood spilled over to other AI peers like Nvidia, AMD, and Oracle, pulling the major indices lower and helping the week end with mixed results: the Dow rose about 1.1% on the back of financials, while the S&P 500 and Nasdaq finished the week down roughly 0.6% and 1.6%, respectively.
Investors may simply be jittery about an apparent AI bubble, ready to punish any hint of bad news. Yet Broadcom’s earnings and future guidance surpassed expectations, suggesting the AI story is not only delivering but accelerating. Bernstein’s Stacy Rasgon, who rates Broadcom a Buy, expressed in a Friday note, “Frankly we aren't sure what else one could desire as the company's AI story continues to not only overdeliver but is doing it at an accelerating rate.” UBS also sounded optimistic, projecting strong profitability and the AI-driven, power, resources, and longevity themes to lift 2026 performance.
In the near term, however, nerves could keep weighing on stocks unless something reassuring emerges—such as Oracle delivering positive cash flow—that would calm fears that the pullback is just a minor twig snapping in a forest of bigger concerns.
What you need to know today
- U.S. stocks declined on Friday as AI names weighed on the market. The prior day had seen record highs, but broad-based selling hit the major benchmarks, with the pan-European Stoxx 600 slipping nearly 0.5% as a regional follow-through.
- The U.K. economy unexpectedly contracted by 0.1% in the three months through October, adding to global growth jitters.
- Oracle has pushed back on a Bloomberg report, confirming it will complete data centers for OpenAI in 2028 rather than 2027, saying there have been no delays in the arrangement.
- Coinbase is exploring an in-house prediction market powered by Kalshi as part of expanding its range of asset classes on its platform.
- Berkshire Hathaway’s leadership transition is stirring questions about whether the famed “Berkshire way” of decentralized operations may be shifting under new management, signaling a potential strategic drift as Buffett’s era evolves.
- Goldman Sachs sees China’s food security goals as a long-term investment theme, highlighting the evolving domestic agricultural sector amid U.S.–China trade dynamics.
And looking ahead, Europe faces a pivotal week with a high-stakes Brussels summit and the European Central Bank’s final 2025 policy meeting. Topics on the table include defrosting frozen Russian assets for Ukraine aid, EU–U.S. trade and tech tensions, and updated economic indicators from the ECB outlook. With global markets in flux, the question becomes: are we witnessing a temporary malaise in the AI rally, or a meaningful shift in the long-term growth narrative? What’s your take—are the recent moves a healthy pause or a warning sign for 2026?
