The AI selloff went global overnight, and Wall Street is answering by running into bonds

South Korea's KOSPI crashed 7.6% to 5,554, its lowest close since April, after falling as much as 9.3% and triggering a 20 minute circuit breaker halt. It was the 7th straight losing session, the longest streak since September 2024

Samsung fell 9.5% and SK Hynix 11.1%. Together those two stocks now make up nearly 47% of the entire KOSPI

Japan's Nikkei dropped 4.9%, its third largest point drop ever, with Advantest down 15% and SoftBank down 9%

Back in the U.S. the tape looks very different. The Dow is up about 0.8% while the Nasdaq slips for a fourth straight day and the S&P 500 sits flat

The bigger tell is the bond market. The 10 year Treasury yield is down to about 5.09% from 5.19% Wednesday, a three week low and on track for its biggest daily drop in more than a year per Reuters. That is happening right after a hot CPI and the largest monthly PPI jump since March 2022

SF Fed President Mary Daly said more hikes are likely needed but she sees no urgency to act at the Oct 27-28 meeting

When inflation runs hot and yields still fall, the market is telling you it fears an AI capex unwind more than it fears the Fed. Money is rotating out of chips and into Treasuries and old economy names. The open question is whether this is a healthy reset for crowded AI trades or the start of the growth scare that bonds are already pricing in

Source: StockMarket.News