Alphabet loses $500 billion as AI spending fears hit global markets

Alphabet lost around $500 billion in market value in a single session after its heavy artificial intelligence spending pushed cash flow into negative territory, triggering a sell-off that ran from Wall Street futures to Asian semiconductor stocks. The Google parent's shares fell 12.6 percent and slipped further after hours, while Intel dropped 23 percent post-close and Amazon fell 7 percent.

The retreat hardened into a global move. Nasdaq 100 futures were down 2.01 percent and S&P 500 futures 0.91 percent, European futures slipped 0.5 percent, South Korea's KOSPI fell 3.48 percent to take its October losses to nearly 16 percent, and Japan's Nikkei dropped 2.12 percent. China's blue-chip CSI300 lost 1.39 percent and headed for its steepest monthly decline in a decade as chip and data-centre names came under pressure.

Digital assets felt the chill. Bitcoin touched a six-week low before paring losses to trade 0.9 percent lower, according to Token Times. The flight to safety lifted government bonds, with the 10-year US Treasury yield down more than 7 basis points in Asian trading to 4.91 percent, a monthly fall of around 37 basis points and the largest since December 2023. The two-year yield fell more than 8 basis points to 4.57 percent, and fed funds futures rose as traders cut bets on further US rate increases, after the Federal Reserve held rates on Wednesday without a firm signal on timing.

Safe-haven currencies firmed: the yen traded at 157.20 to the dollar and the Swiss franc at 0.8213, near a one-month high, while the euro edged up 0.1 percent to $1.1194 but stayed on course for a second straight monthly loss of more than 1 percent. The Bank of Japan held rates as expected, then said it would accelerate sales of its exchange-traded fund holdings next year and signalled closer attention to inflation, keeping a December hike in play; Japanese equity futures weakened on the news.

Oil extended gains and stayed on track for a fourth monthly rise after an attack on a tanker in the Strait of Hormuz underlined supply risks tied to the US-Israeli war on Iran. The common thread across assets, investors said, is a market re-pricing what AI capital expenditure is worth, and who pays for it.