U.S. Stocks Plunge Amid Fears of an AI Bubble Collapse

Fundamental Analysis

U.S. stocks fell sharply, with analysts divided in their outlook. The S&P 500 and Nasdaq posted major losses, while Bitcoin dropped below $100,000. The Nikkei 225 also plunged more than 2,000 points at one stage. AI-related stocks were heavily sold, spreading losses to Japanese firms. The USD/JPY fell slightly to the 153 range. Investors appear to be losing enthusiasm as the U.S. government shutdown begins to dampen the economy. The cryptocurrency market also suffered a steep decline, suggesting the need for caution against a broader market correction.

Weakness in the U.S. labor market had been evident since summer, yet stock prices continued to rise, driven mainly by a few AI-related mega-cap stocks. The Nikkei's surge above 50,000 was also led by similar AI-linked rallies.

While it is impossible to confirm a bubble until after it bursts, when investor sentiment cools, markets tend to experience rapid declines.

S&P 500 Daily Chart Analysis

The S&P 500 has fallen to its 26-day EMA, signaling an ongoing correction. A divergence between the RSI and price action has appeared — a classic sign of a late-stage trend. Although a few large buys have pushed prices to new highs, overall selling pressure is intensifying.

Given the simultaneous declines in U.S. equities, cryptocurrencies, and gold, the market environment has shifted abruptly. The correction could extend to the 52-day EMA, and a break below that level may trigger a sharper drop toward 6,500. Investors should remain alert and manage positions carefully, as this may ripple through global markets.

Key Economic Data Today

Note: U.S. economic data releases may be delayed due to the government shutdown.

Indicator	Time (JST)
U.S. ADP Employment Report	22:15
U.S. PMI (Purchasing Managers Index)	23:45