Bitcoin and US stocks are starting the week under pressure after a sharp sell-off last week. The S&P 500 fell 2.7% for the week, and the Nasdaq dropped 3.4%. US equities lost nearly $3 trillion in market value in one trading session. Bitcoin slipped below $75,000 and briefly touched the $73,000 area. The moves came as investors weighed AI spending concerns, interest rate expectations and weaker sentiment across risk assets.
AI Spending and Rates Hit Tech Stocks
Three issues seem to have driven the stock decline. First, investors are worried that possible limits on AI data center expansion could reduce demand for chips and related infrastructure. Election campaigns also drew more attention to data center construction, with candidates from both major parties raising questions about its growth. Semiconductor shares took the hit. Micron fell 22%, Palantir dropped 13%, and Oracle and AMD each lost around 11%. Nvidia fell about 9%.
Second, the October US jobs report showed 165,000 new jobs, well above expectations of 65,000. That stronger reading raised concerns the Federal Reserve could keep rates higher for longer or even consider another hike in December. Higher borrowing costs tend to pressure technology stocks and other risk-sensitive assets.
Third, tech companies are spending billions on AI infrastructure. Investors are still unsure how quickly those outlays will produce returns. Worries about costs and future profit have added to selling pressure on AI-linked shares.
Crypto Funds See Large Outflows
Bitcoin faced the same risk-off mood and steady withdrawals from crypto investment funds. Bitcoin ETFs recorded $1.28 billion in weekly outflows, the largest weekly withdrawal since June. More than $840 million left those funds on Thursday and Friday. Ethereum ETFs saw about $365 million in outflows, their sixth straight week of withdrawals.
Bitcoin traded above $80,000 on Wednesday before falling toward $76,000 and briefly touching the $73,000 area. The Crypto Fear and Greed Index fell to 29. Bitcoin closed the week near $74,851, below $75,000 and its 50-week moving average near $75,500. A weekly close below $73,500 could strengthen the bearish case. A recovery above $76,200 might improve short-term sentiment.
What to Watch This Week
Markets may stay cautious before US inflation data on November 10. CPI is expected to rise from 3.7% to 3.9%. A hotter reading could lift rate expectations and pressure both stocks and Bitcoin. A softer number could support a rebound.
Investors will also watch Nvidia earnings on November 17 for clues on AI chip demand and tech spending. For Bitcoin, reclaiming $75,000 and holding above $76,200 would matter. A break below $73,200 could raise the risk of more losses. For now, rate expectations and AI investment concerns remain the main drivers. Whether the sell-off continues will depend largely on inflation data and how investors react to it.
