Wall Street indices ended higher on Thursday as dip buyers halted the AI selloff and Nvidia CEO Jensen Huang reassured investors about CoreWeave, despite a hotter-than-expected September wholesale inflation report showing PPI rising 1.3% month-on-month. The Dow Jones ended the session with gains of 556 points at 52,177.69, up 1.08%, while the S&P 500 gained 0.33% to 7,744.06 and the Nasdaq recovered from a drop of as much as 1.4% to end just above the flat line at 26,713.03, up 0.08%. According to CNBC TV18, benchmark indices on Wall Street had a session marked by recovery from lower levels as dip buyers once again stepped in to halt the sell-off seen in AI and Semiconductor shares. Shares of Nvidia, AMD, and other memory chipmakers like Sandisk, Western Digital, Seagate continued to add to Wednesday's losses but recovered sharply from the lows of the day. Gains on the Dow were supported by shares like Nike, Salesforce, The Home Depot, Sherwin-Williams, UnitedHealth Group, IBM, American Express, Boeing, Visa, Amgen, and McDonald's Corp. In a sign of rotation to other sectors, an equal-weighted version of the S&P 500 - which strips out market-value biases - climbed 1.4%, as reported by NDTV Profit.
CoreWeave rebounded 5.94% after declining over 15% in the previous session amid concerns surrounding the company's borrowing to build AI infrastructure. As per CNBC TV18, Nvidia is the second-largest shareholder in CoreWeave with a stake of close to 10%, which helped reassure investors about the company's prospects. However, concerns surrounding its debt continue as Credit Default Swaps are now pricing in a 60% chance of CoreWeave defaulting on its repayment obligations within the next five years. The "yield to maturity" on its 9.75% bond due in 2031 surged to as high as 15.78%, while swap spreads crossed the threshold that generally indicates distress levels. CoreWeave CEO Mike Intrator had previously said in an internal memo that the market was acting 'irrationally' and that he remained confident in the AI cloud company. Concerns about CoreWeave's viability have contributed to a recent rout in stocks amid speculation that the massive buildout of AI infrastructure has outrun the ability of companies to get a return on their investments, as noted by NDTV Profit.
Wall Street indices ended higher despite a hotter-than-expected wholesale inflation print with the September PPI rising 1.3% month-on-month, the highest monthly increase since March 2022 and well above the 0.6% estimate. According to CNBC TV18, on a year-on-year basis, the increase was 6.3% compared to estimates of 5.5%. The probability of the US Federal Reserve raising interest rates by 25 basis points in October now stands at 28%. Some investors said an infrastructure expansion billed as the largest ever was inevitably likely to face setbacks, with expectations of further volatility as interest rates rose and Federal Reserve tightening increased. Worries about the durability of the AI investment cycle have also intensified a debate about whether bonds are offering value after a plunge that had sent yields to multi-year highs, as reported by NDTV Profit. "Two questions matter. Is demand for AI real? Yes," Manish Singh at Crossbridge Capital told Bloomberg. "Are we going back to working and using software as we did before AI? No. The structural opportunity is real, but that does not mean every company building the infrastructure will generate attractive returns for investors."
Selling remained concentrated among heavily indebted companies and stocks that had recorded substantial gains earlier this year. AI infrastructure provider Nebius fell 5%, AI server maker Dell Technologies dropped 6.9%, and memory-chip company SanDisk lost 2%. Despite the declines, Nebius had gained 112% in 2026, Dell had surged 273%, and SanDisk had climbed 476%, according to LSEG data. The reaction to TSMC's latest outlook was particularly revealing, as the chipmaker delivered a very strong revenue forecast yet the news failed to provide the usual lift for technology stocks. Normally, stronger-than-expected demand for advanced chips would reinforce the bullish AI narrative, but investors largely looked through it, with the debate shifting from how big AI can become to how profitable the investment cycle will ultimately be. Given the extraordinary amounts of debt being taken on to build out AI infrastructure, higher borrowing costs are far from ideal, according to David Morrison at Trade Nation. "AI may be the future. Debt servicing is still the present," Singh concluded, noting that future cash flows must justify today's enormous capital commitments.
Despite current challenges, M&A involving Asian data centres is still on track for a record year, reaching $21.3 billion as of Tuesday, more than double the $10 billion recorded in all of 2025. Singapore-based DayOne is expected to go public as soon as November, seeking to raise up to $5 billion, while AirTrunk is nearing a deal to sell its Johor data centre in Malaysia to a group of investors including local pension fund KWAP at a valuation of about $1 billion. Bain Capital has also received final bids for at least 40% of its pan-Asian platform Bridge Data Centres in a deal that could value the business at around $5 billion. However, higher interest rates were expected to increase borrowing and construction costs, with unprofitable and less-profitable companies likely to face the greatest pressure. "I do think long rates above 5% and creeping towards 6% is a problem for the marginal borrower," said Ross Mayfield, investment strategy analyst at Baird. Looking ahead, all eyes will be on Federal Reserve Chair Kevin Warsh's remarks for clues on whether officials are pivoting from a skip to an October rate-hike in light of the latest inflation data, according to Krishna Guha at Evercore. "On balance, we think Warsh will talk in a way that does not suggest an October hike," Guha said. "Warsh will be mindful of the global wobble in tech stocks and signs financing conditions are tightening for more exposed AI names, on top of the prior move up in longer-term yields."
