From The Economic Times · · 1m 30s
OpenAI Revenue Drop Slows Tech Stocks
OpenAI's revenue fall and high yields drag Nasdaq lower as AI market concerns rise.
In brief
OpenAI's revenue fall and high yields drag Nasdaq lower as AI market concerns rise. OpenAI's reported revenue shortfall and rising Treasury yields pressured tech stocks, causing Nasdaq to drop 1.9% as investors questioned AI sustainability. Originally reported by The Economic Times.
OpenAI revenue concerns
Megacap technology stocks dragged US equity indexes lower as concerns grew that OpenAI’s revenue could disappoint investors already questioning the sustainability of the AI boom.
OpenAI revenue report
The Financial Times reported that ChatGPT-maker OpenAI’s annualised revenue was $20 billion below the amount it had previously indicated.
Nasdaq decline
The Nasdaq 100 fell 1.9%, while the S&P 500 declined 0.9% as of 1:26 p.m. in New York.
Treasury yield rise
The yield on the 10-year Treasury rose to 5.3%, weighing on rate-sensitive stocks as renewed energy-supply risks reinforced expectations that borrowing costs could remain high.
Energy supply risks
Renewed concerns about global energy supplies further weakened market sentiment. Oil prices rose after a report said the White House had asked the Pentagon to prepare possible military-strike options against Iran that could be executed before the midterm elections.
Hurricane Isaias
Hurricane Isaias was also developing in the Gulf, adding to fears of potential disruptions to energy production and transportation.
Federal Reserve comments
Hawkish comments from Federal Reserve Governor Christopher Waller added to the pressure. Waller said further interest-rate increases would probably be required to bring inflation under control, although policymakers had flexibility over the timing and did not necessarily need to raise rates at consecutive meetings.
The short version
OpenAI's reported revenue shortfall and rising Treasury yields pressured tech stocks, causing Nasdaq to drop 1.9% as investors questioned AI sustainability.
