"While some on Wall Street claim it was simply a rotation out of technology stocks, more concerns about the AI bubble have arisen. Michael Burry, of "Big Short" fame, who had already stated that he was long put options (in a significant way), on NVIDIA ( NASDAQ: NVDA) and Palantir Inc. ( NASDAQ: PLTR), issued a strong rebuke of tech companies' method of depreciating assets."
"Yields moved higher on Tuesday due to progress in ending the government shutdown, which is expected to pave the way for a surge in economic data and potentially a strong September jobs report. That, in turn, could squash hopes that the Federal Reserve will lower rates next month at the final 2025 meeting. The 30-year bond closed that day at 4.71%."
Futures traded higher at midweek as the Dow gained 1.20% to a record 47,927 and the S&P 500 rose 0.28%. The NASDAQ fell 0.25% to 23,468 amid rotation out of tech and renewed AI valuation concerns. Michael Burry, holding large long put positions on NVIDIA and Palantir, accused major AI and cloud hyperscalers of understating depreciation on computing assets to inflate earnings and cited circular financing issues. Treasury yields rose, with the 30-year at 4.71% and the 10-year at 4.12%, as progress toward ending the government shutdown increased odds of stronger economic data and reduced near-term Fed rate-cut hopes. Oil prices climbed, with Brent at $65.06 and WTI at $60.93.
Read at 24/7 Wall St.
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