Stock market today: Tech sells off as AI funding fears hit Oracle; Micron lifts after hours
US equities slipped Wednesday as rate path uncertainty met a fresh hit to AI enthusiasm. The Nasdaq fell about 1.8%, the S&P 500 dropped a little over 1%, and the Dow eased roughly 0.5%.
Pressure centered on tech after a report that Oracle's $10 billion data center plan lost support from private lender Blue Owl Capital. The backlash widened fast: Oracle slid nearly 6%, while Nvidia lost almost 4%, Broadcom fell over 4%, and Alphabet dropped more than 3%.
Why it matters
AI infrastructure spending is being financed with rising debt and lease commitments. That model works until credit gets expensive or confidence breaks.
Oracle's latest filing highlighted $248 billion in off-balance-sheet lease obligations, which has sharpened focus on leverage and liquidity. Credit markets are reacting too, with Oracle CDS spreads recently touching their highest levels since 2009, despite management's intent to protect an investment-grade rating (currently BBB).
Micron pops after hours on a strong print and guidance
Micron beat and raised, and the stock jumped as much as 7% after the bell. The company posted EPS of $4.78 on revenue of $13.64 billion (vs. $3.96 and $12.88 billion expected), and guided fiscal Q2 revenue to $18.70 billion ± $400 million, ahead of the $14.20 billion consensus.
Management cited robust data center demand, with hyperscalers lifting spend on capacity and AI workloads. Watch for read-through to HBM supply, pricing, and timelines across the Nvidia server stack.
Macro setup: Jobs noise, CPI next, and the Fed's "room" to cut
Markets are sifting through a noisy November jobs report while waiting on Thursday's CPI. The goal: refine the track for 2026 rate settings.
Fed Governor Chris Waller said there's still scope to cut, hinting at 50 to 100 basis points of room, with neutral below 3%. The policy rate sits at 3.5% to 3.75% after last week's move.
Other notable moves
- Precious metals: Gold pushed near a record, up more than 60% year to date. Silver spiked 5% to trade above $66, with price action consistent with a short squeeze.
- Bitcoin: The token hovered near $86,000 amid cautious risk sentiment and chatter over the next Fed Chair pick.
- Streaming: Netflix rose after Warner Bros. Discovery's board urged shareholders to reject a rival Paramount Skydance bid, flagging funding concerns.
- AI infrastructure: GE Vernova fell nearly 8% as funding scrutiny spilled over. The company's electrification backlog has quadrupled since 2022 and could double again by 2028, with hyperscaler exposure at about 10% today and targeted to grow to roughly one-third over the next three years.
IPO watch: Medline prices the year's biggest deal
Medical supply giant Medline raised about $6.26 billion, selling shares at $29. The stock opened around $35, a gain of more than 26%, marking 2025's largest IPO.
Concentration risk and stretched valuations
The top 10 names now represent roughly 41% of S&P 500 market cap and about 32% of earnings - highs not seen since at least 1980. The "Magnificent Seven" remain the driving force behind AI enthusiasm, up ~21% on average this year, with Alphabet leading after momentum around its Gemini 3 model.
Valuations show it: the S&P 500 trades in the 91st percentile of its 10-year history. If liquidity tightens or AI capex turns lumpy, leadership could get fragile fast.
What finance teams should focus on
- Recheck AI capex exposure: Cloud, semis, data centers, and power infrastructure - model sensitivity to financing costs and lease liabilities.
- Stress-test rate paths: Map scenarios for an additional 50-100 bps of cuts against earnings, cost of capital, and the curve.
- Semis read-through: From Micron's outlook, track HBM capacity, pricing, and delivery risk across the Nvidia ecosystem and key suppliers.
- Credit signals: Monitor Oracle spreads, CDS, and covenants. Equity reacts late when credit starts flashing.
- Flows and hedges: Note haven demand in gold and silver. If you use metals as portfolio ballast, reassess sizing and liquidity.
- Pipeline into 2026: Big-ticket listings (SpaceX, major AI players, Databricks) could test risk appetite and valuation discipline.
Key dates and resources
- Next CPI release: BLS CPI
- Fed speeches and updates: Federal Reserve - Speeches
Quick take
Two forces are colliding: tighter scrutiny of AI financing and a Fed signaling more room to ease. If funding wobbles, leaders with heavy capex plans and lease stacks will be most exposed, even with strong demand stories.
Keep your playbook simple: respect credit signals, lean on scenario analysis, and use company-level cash flow discipline as your filter. Hype is loud. Cash is quiet - and it always wins.
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