Global Shares Struggle Amid AI Valuation Concerns Ahead of Fed Decision
Global stock markets remained subdued on Wednesday as investors braced for the Federal Reserve's rate decision and key earnings reports from tech giants. A sharp selloff in Asian markets, particularly South Korea’s KOSPI index which fell nearly 6%, reflected growing concerns over AI-linked chipmakers amid fears of competition from China. Even strong quarterly results from SK Hynix failed to prevent a significant drop in its shares due to overly high expectations. The market is closely watching earnings reports from Microsoft and Meta, with investors demanding clear evidence that the current AI-driven growth cycle remains robust. Meanwhile, European markets showed little movement while U.S. futures edged higher ahead of the Fed's decision expected later in the day. Traders are largely anticipating a rate hold but remain wary about potential hikes by year-end. Oil prices rose sharply following renewed Middle East tensions, adding to inflation concerns and pushing Treasury yields upward.