A selloff built on debt fears

CoreWeave's shares fell 15.5% on Wednesday, 14 October, after reports that the cloud provider's bond yields had reached levels associated with distressed debt. Yields rose above 15%, and the drop spread into a broad selloff in AI-linked equities. The Nvidia-backed company is one of the largest neoclouds and has close ties to the chipmaker, which makes its financing a test case for the wider AI trade. Investors are divided between those who see rising bond yields as a threat to the rally and those who expect computing demand to make such worries irrelevant. The stock and the company's debt both came under pressure over several sessions.

Huang steadies the stock

On Thursday, 15 October, CoreWeave began the session by extending Wednesday's losses before recovering. The turn followed comments from Jensen Huang, who said he sees no need for Nvidia to backstop the company. Speaking to reporters at a Stockholm event, he added that he is optimistic and that CoreWeave's cost of capital is falling.

“CoreWeave's financial strength is improving every day.”

By the close, CoreWeave had gained 5.94% to $69.69. Nvidia itself slipped 1.84%, AMD lost 1.50% and Broadcom 0.55%. The Nasdaq ended up 0.08%, the S&P 500 rose 0.33% and the Dow Jones gained 1.08%. Ten-year Treasury yields eased to 5.08% by about 22:30 Brussels time, down from a 5.19% close the previous day and 5.35% on 8 October, which helped steady Wall Street.

Asian markets rebound after heavy losses

Asian stocks rebounded on Friday, 16 October, after heavy selling in the previous session. South Korea's KOSPI climbed 2.8% after a nearly 8% plunge, while Japan's Nikkei recovered 1.8% of a drop of close to 5%. Memory-chip shares took a heavy hit on Thursday, with SK Hynix closing down 11% and Samsung Electronics down 9.5%, as China's ChangXin Memory Technologies reported progress on a next-generation DRAM design that could sharpen competition. Markets remain jittery, with tech earnings due in the coming weeks.

“Global markets could potentially be in for a protracted period of this sort of volatility.”

Debt behind the AI buildout

Gartner projects AI providers will spend $7 trillion on infrastructure through 2030 but generate no more than $3.6 trillion in related revenue over the same period. Its forecasts also warn of more than $4 trillion in possible write-downs by the end of 2032 if spending continues at the current pace, and that more than 80% of neoclouds will stop operating independently by 2030. Global AI-related debt issuance dropped to $23 billion in September 2026 from $113 billion in June, according to figures cited by the Financial Times.

2026-06113

2026-0923

2026-06

113 USD billions

2026-09

23 USD billions

Data from the article text

Roughly one-third of AI capital spending is now funded by borrowing, and JPMorgan CEO Jamie Dimon confirmed the bank is tightening credit to limit concentration risk. About $18 billion in bank loans for an Oracle data center campus has slipped into stressed territory. Firmus, an AI cloud provider backed by Nvidia, has put aside a listing that targeted a valuation above $30 billion.

Insider sales and the longer view

Three CoreWeave co-founders, Michael Intrator, Brian Venturo and Brannin McBee, have sold $3.3 billion worth of company shares since the initial public offering last year. The sales came as rising credit risks and wariness about AI spending added to volatility in the stock. Reflection AI co-founder Ioannis Antonoglou told Semafor that businesses could need 10 to 20 years to rebuild their operations around AI. Nvidia's share price has risen almost 1,415% since the end of 2022 as companies bought its chips, but investors are now asking whether the pace of AI spending can be sustained.