Wall Street Grapples with US$5.7 Trillion Rout as AI Bets Unwind, Fed Rate Hike Bets Reinforced

The US stock market has experienced a significant downturn, with a US$5.7 trillion loss in value since its October 6 peak, including a US$2.3 trillion wipeout in the Nasdaq 100 on Thursday. Despite a rebound in chipmakers on Friday, strong jobs data has reinforced expectations for another US Federal Reserve interest-rate increase in December, as the Fed remains focused on inflation. The market turmoil is linked to unease over the artificial intelligence (AI) boom, stretched valuations, mounting debt, and new political threats from a Democratic sweep of Congress, raising the prospect of restrictions on data-center buildout.