![\"Traders](\"https:\/\/www.newsbeep.com\/ca\/wp-content\/uploads\/2025\/11\/1762367349_716_default.jpg\")
Traders work on the floor at the New York Stock Exchange earlier this year. (Brendan McDermid\/Reuters)<\/p>\nWall Street’s main indexes were subdued at the open on Wednesday, following a tech-led selloff in the previous session over surging valuation concerns.<\/p>\n
At the opening bell, Wall Street’s main indexes were muted: the Dow Jones Industrial Average rose 0.03 per cent to 47,097.31, the S&P 500 fell 0.03 per cent to 6,769.77, while the Nasdaq Composite rose 0.04 per cent to 23,358.075.<\/p>\n
But selling extended into a second day on Wednesday in global markets, leaving those in Seoul and Tokyo around five per cent beneath\u00a0peaks reached on Tuesday morning. <\/p>\n
Falls in technology\u00a0stock prices from the day before are cause for caution but not panic yet, say brokers and investors who have been riding a runaway market to\u00a0record highs and some stretched valuations.<\/p>\n
Hardest hit have been the biggest winners of a rally that\u00a0has vaulted chipmaker Nvidia from a niche player to the most\u00a0valuable company on Earth.<\/p>\n
“The selloff appears to be largely positioning-driven, with\u00a0recent outperforming names taking the worst of the move,” said\u00a0Jon Withaar, senior portfolio manager at Pictet Asset Management\u00a0in Singapore.<\/p>\n
There was no obvious trigger for the pullback, which began\u00a0with an unexpectedly negative reaction to strong financial\u00a0results at Silicon Valley data and artificial intelligence firm\u00a0Palantir Technologies.<\/p>\n
Traders work on the floor at the New York Stock Exchange earlier this year. (Brendan McDermid\/Reuters)<\/p>\n
Shares in the market darling finished down nearly eight per cent on\u00a0Tuesday, and fell a further three per cent in extended trade.<\/p>\n
“So people are up to their noses in these AI stocks,” said\u00a0Herald van der Linde, head of equity strategy for Asia Pacific\u00a0at HSBC. “But how much further can they go? How much more can\u00a0they buy? And my belief is that what we’re going to see is a\u00a0breather … and the breather could come with a rotation.”<\/p>\n
On Tuesday, Nvidia shares fell nearly four per cent on Wall Street to\u00a0trade down about seven per cent from last month’s peak. Meanwhile, suppliers,\u00a0competitors and firms up and down the AI supply chain came in\u00a0for a beating in Asia on Wednesday.<\/p>\n
“It’s fairly blanket selling in the risk-leverage part of\u00a0the market, which to us looks like short-term profit-taking,”\u00a0said Angus McGeoch, Barrenjoey’s head of equities distribution\u00a0for Asia in Hong Kong.<\/p>\n
He said fund managers with an eye on their 2025 results\u00a0would be quick to duck out of the downturn at this time of year,\u00a0but are not yet looking for a wholesale exit.<\/p>\n
“Obviously (they) don’t want to give up a lot, given the\u00a0year’s been kind … but if the market looks like it wants to\u00a0go again, then I don’t think it would take much to get people\u00a0back involved.”<\/p>\n
Fears of an AI bubble<\/p>\n
Markets have for months marched past worries over elevated\u00a0interest rates, stubborn inflation, trade turmoil and a patchy\u00a0global economy leading to questions about whether the artificial\u00a0intelligence boom is a bubble waiting to burst<\/a>.<\/p>\n Tuesday’s two per cent drop in the Nasdaq followed a rise\u00a0of more than 50 per cent from April lows.<\/p>\n LISTEN | Are data centres warping the North American economy?:<\/p>\n The Current13:32Will the A.I. bubble burst?<\/p>\n There are growing concerns from economists, tech industry insiders and investors that artificial intelligence might be a bubble about to burst. Data centres are a rapidly growing part of the U.S. so big that some observers like MIT fellow Paul Kedrosky believe it’s warping the North American economy. Murad Hemmadi, a reporter with the Logic, argues that we only know about bubbles in hindsight, and until it bursts, we’re going to be waiting to find out.<\/p>\n Wall Street chiefs Ted Pick of Morgan Stanley and David\u00a0Solomon of Goldman Sachs gave voice to some of the unease in\u00a0markets and raised the prospect of a pullback at an investment\u00a0summit in Hong Kong.<\/p>\n Big name investor Michael Burry, who famously predicted the collapse of the U.S. housing bubble which led to the 2008 financial crisis and is depicted in the movie The Big Short, has bet against both Nvidia and Palantir<\/a>, which has fuelled fears about a bubble.<\/p>\n