Stocks slump as US tech rebound falters, oil dips below $90
TDT | Manama
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Stock markets fell Tuesday, giving back earlier gains as US technology stocks turned lower after weeks of solid gains on renewed doubts about prospects for AI names.
Oil prices fell meanwhile, with Brent crude briefly dipping below $90 per barrel for the first time since April 14, after US President Donald Trump hinted at a deal with Iran in the coming days, despite renewed strikes by Israel on Hezbollah targets in Lebanon.
After opening higher, Wall Street indexes were solidly in the red, led by steep declines for tech heavyweights.
Apple shares were down more than four percent after lacklustre reviews for an AI update to its Siri voice assistant, spurring caution among investors who have seen tech valuations push equity markets into record territory.
The downturn followed heavy selling last Friday after strong US jobs data that raised the prospect of higher US interest rates to curb inflation, which would raise borrowing costs for AI firms planning massive spending on chips and data centres.
"Investors remain cautious after the sharp selloff at the start of the week," said Anna Macdonald, investment strategy director at Hargreaves Lansdown.
OpenAI's announcement that it had applied for an IPO of its shares -- just as Elon Musk's SpaceX is prepping a record-smashing share sale this week -- also suggested that investors were selling their tech holdings to buy into the new offerings.
But "the IPOs of SpaceX, Anthropic and OpenAI are less about buying into a business and more about buying into an idea," noted Katherine Brooks, research director at trading platform XTB.
Peace deal hopes
Earlier in Asia, bargain buying saw Seoul's Kospi index surge on Tuesday after plunging more than eight percent on Monday, tracking the pre-weekend tech sell-off on Wall Street.
European indexes also retreated before the close, with London leading the downturn owing to a decline in the share price of British drugs giant GSK, which announced an all-cash $10.6 billion takeover of US cancer specialist Nuvalent.
Frankfurt and Paris stock markets had gained earlier after official data showed that industrial production in Europe's biggest economy Germany rose slightly in April alongside its exports.
US President Donald Trump on Tuesday said negotiations over a peace deal to end the Middle East war were in their final stages and a deal could come in "two or three days".
"The market has heard that before, and even though it has yet to see an actual deal, it continues to respect the possibility," said Briefing.com analyst Patrick O'Hare.
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