U.S. Stock Markets and Bitcoin See Sharp Losses Amid AI Market Doubts
Introduction
U.S. equities continue their decline, with the S&P 500 headed toward a fourth consecutive loss—its longest losing streak since August. Concerns over the sustainability of artificial intelligence (AI) sector valuations and ongoing global market uncertainties are fueling risk aversion. Meanwhile, Bitcoin fell below $90,000 for the first time in seven months, highlighting intensified volatility in speculative assets.
U.S. Markets: Indices Drop as Risk Appetite Dwindles
On Tuesday morning:
S&P 500 futures slipped by 0.4%.
Nasdaq 100 futures slid by 0.4%.
The S&P 500 closed Monday down 0.92% at 6,672.41.
Dow Jones lost 557 points (-1.2%).
The recent sell-off marks the biggest three-day decline for both the Dow and S&P 500 since mid-April. Elevated worries about AI-driven stock valuations—along with anticipation for Nvidia’s earnings report—have sparked widespread caution.
AI Sector Faces Growing Skepticism
Investor sentiment has soured as concerns mount over the high valuations in the AI sector:
Nvidia’s stock fell 2% ahead of earnings, with analysts expecting $54.8 billion in quarterly revenue, a 56% year-on-year surge.
Meta Platforms dropped 7%, and Tesla retreated by 11%.
The S&P 500’s year-to-date gains have been heavily driven by AI-linked stocks-roughly 75% of returns since the launch of ChatGPT.
The CBOE Volatility Index jumped to 22.38, from 19.83, indicating increased investor nervousness as markets reassess AI positions.
Federal Reserve Uncertainty and Economic Data
The probability of a Fed rate cut in December has plummeted, dropping to 40% from over 90% a month earlier.
Mixed signals from Fed officials further fuel anxiety:
Governor Christopher Waller supported a 25bps cut due to weak labor and contained inflation.
Atlanta Fed President Raphael Bostic warned that price stability still poses risks, as inflation remains above target levels.
Investors are awaiting delayed economic data, including the September jobs report and Q3 corporate results (Home Depot's earnings beat revenue forecasts but missed profit targets).
Bitcoin Plunges as Risk Assets Retreat
Bitcoin dipped below $90,000, its lowest in seven months, marking a steep 17% decline since early November and erasing 2025 gains.
The sell-off reflects a broader retreat from speculative assets in a climate of rising uncertainty and diminished optimism for rate cuts.
Other large-cap tech stocks and risk-driven cryptocurrencies saw similar downward pressure.
Key Takeaways
U.S. equities are on track for a fourth consecutive loss, with AI sector skepticism and economic uncertainty weighing heavily on sentiment.
Bitcoin’s drop below $90,000 underscores risk-off behavior among investors as Fed rate cut hopes fade.
Anticipation over Nvidia's earnings and delayed macroeconomic data are feeding market nerves.
Sources
Sources:
https://home.saxo/content/articles/macro/market-quick-take---18-november-2025-18112025
https://www.barrons.com/livecoverage/stock-market-news-today-111825