AI Trade Slumps as Investors Seek Safety in Treasuries

The artificial intelligence trade is faltering as investors shift to Treasuries for safety, following mixed earnings from major AI spenders that failed to sustain market optimism. Nasdaq 100 futures fell 1.7%, threatening to erase much of the index's weekly gains. Meta Platforms rose after beating revenue estimates and raising capital spending, while Tesla declined on reduced spending. Lam Research shares dropped over 7% on weak guidance, and Brent crude topped $111 a barrel after attacks in Saudi Arabia. Ten-year Treasury yields fell to 5.08% on haven demand. Concerns are growing that heavy AI investment may take longer to pay off, fueling worries about stretched valuations and a potential bubble. The yen and Swiss franc also benefited from the flight to safety, while the dollar slipped.