The major U.S. stock indices, including the S&P 500 and Dow Jones, started the day on a downward trend, reflecting growing market caution fueled by escalating tensions in the artificial intelligence (AI) sector. On Tuesday, October 11, Bitcoin (BTC) saw a decline of 2%, dropping to $104,314.
This downturn in the equity markets coincides with the announcement from Japan”s SoftBank Group, which revealed it had divested its entire stake in Nvidia. This strategic move aims to reallocate funds towards SoftBank”s own AI projects but has raised concerns on Wall Street regarding the sustainability of the rising valuations within the technology sector.
In addition, CoreWeave, a company backed by Nvidia, has reduced its annual revenue forecasts despite posting solid quarterly results. The stock of CoreWeave dropped more than 8% in pre-market trading due to delays in contracts with data center partners. Such developments have dampened risk appetite, negatively impacting the cryptocurrency market.
As a result, Bitcoin, previously trading near $107,000, reflects the global aversion to riskier assets in light of uncertainties within the technology sector. Nonetheless, some investors remain optimistic that the ongoing 41-day government shutdown in the U.S. may be nearing an end. Recently, the Senate approved a new funding measure, which now heads to the House of Representatives, potentially paving the way for the reopening of federal services and the resumption of economic data releases.
International trade concerns are also looming, particularly regarding U.S.-China relations. Reports from the Wall Street Journal indicate that Beijing plans to impose restrictions on the use of strategic minerals, such as rare earth elements, by U.S. military forces, reigniting concerns over the stability of the current tariff truce.
Investors are also closely monitoring an upcoming event from Advanced Micro Devices (AMD), where the company is expected to unveil new strategies to compete in the AI chip market dominated by Nvidia. On the corporate earnings front, Sony stands out today, while results from Disney and Cisco will be analyzed later in the week.
