Microsoft Cancels AI Leases, Spurring Tech Sell-Off
Microsoft has reportedly canceled some leases for US data center capacity, citing a potential oversupply position, which sent U.S. stocks into reverse. The Dow Jones Industrial Average increased by 243 points, while the S&P 500 rose by 0.2%, but the tech-heavy Nasdaq dropped by 0.2%. Nvidia's upcoming earnings are also looming, following a breakthrough in Chinese AI that sparked a selloff in Nvidia and other tech stocks last month.
- This announcement highlights the volatile nature of cloud computing investments, where oversupply can lead to sharp price drops and significant losses for investors.
- How will Nvidia's earnings report address concerns about its ability to maintain profitability and growth in the competitive AI chip market?