AI Stocks Slide After Earnings Disappoint; French Bonds Tumble and Oil Tops $112

By Joe Stonor

Artificial-intelligence stocks slid across the globe and investors turned to the safety of Treasurys, as a renewed selloff in French government bonds and a fresh run-up in oil prices strained markets.

Nasdaq futures dropped 1.7% after a bevy of earnings releases from AI companies disappointed investors and put an abrupt stop to Wednesday's relief rally. With the exception of Meta Platforms--whose bullish signals on Muse adoption helped the stock rise 1% premarket--earnings releases were poorly received. Lam Research and IBM fell by 8.5% and 5.4%, respectively, in the premarket. AI stocks also fell across Europe and Asia, where South Korea's memory chip-dominated Kospi closed down 3.5%.

"The problem here is that expectations are quite high going into the quarter," said Quilter Cheviot's head of technology research Ben Barringer. "It's a difficult setup because you've got to smash it out the park to get your stock to work."

S&P 500 futures also fell sharply--down 1%--while futures for the Dow Jones Industrial Average slid 0.6%. Higher oil prices and the jump in French borrowing costs added to headwinds for European indexes, all of which fell sharply. The Stoxx 600 was down 0.9% in early trade.

Benchmark Brent crude oil prices rose by 3% to trade above $112 a barrel, while West Texas Intermediate contracts for December delivery moved toward $100 a barrel. Renewed attacks on Saudi energy infrastructure added to concerns the U.S. and Israel could renew direct hostilities against Iran. Saudi Arabia's energy ministry said Wednesday that air defenses intercepted a drone targeting a facility at Saudi Aramco's Shaybah oil field.

In the bond market, investors ditched French government bonds, with the spread between yields on 10-year French OATs and the equivalent German bond widening to 164 basis points--the highest such level since 2011. Ten-year OAT yields jumped 7.6 basis points to 5.085%, the highest level since 2002.

In the U.S., Treasurys strengthened, with yields falling across the curve. Ten-year Treasury yields fell 6.9 basis points to trade below 5.080%, while 30-year yields fell 5.6 basis points to trade around 5.380%. The dollar weakened while the pullback from risk dragged bitcoin down 3%. Gold futures fell 1% in New York to hover above $4,100 a troy ounce.

For the day ahead, the macro calendar is light besides weekly U.S. jobless claims. Procter & Gamble and Lockheed Martin are among companies reporting earnings before the opening bell.

Write to Joe Stonor at josephmichael.stonor@wsj.com

(END) Dow Jones Newswires

October 22, 2026 04:38 ET (08:38 GMT)