U.S. stocks retreated on Thursday after Oracle Corp. posted its steepest decline in nearly a year, reviving concerns that heavy spending on artificial intelligence is putting pressure on balance sheets faster than it generates returns.
Meanwhile, the cryptocurrency market traded relatively stable, modestly decoupling from equity weakness as traders remained selective about risk.
Bitcoin traded back above $92,000, according to data from CoinDesk, extending modest gains after holding key support earlier this week. The largest token is up around 2.6% on the day, stabilizing after a volatile stretch that briefly dragged prices towards the low $90,000s.
Traders seemed more focused on preserving the trend structure than chasing upside, with flows concentrated in large-cap assets.
“Major institutions are increasingly divided on the path forward,” Bitunix analysts told CoinDesk in an email. “Some argue that improving inflation supports further cuts from March, while others expect a pause in January, a wait-and-see approach during the first half, or even a delay in easing until after June.”
“Several Wall Street firms noted that this ‘aggressive cut’ highlights the FOMC’s growing difficulty in maintaining cohesion under Powell’s leadership,” the email added.
Ether rose alongside bitcoin, rising towards $3,260, while SOL outperformed major currencies with a jump of more than 6%, reflecting renewed interest in higher beta layer 1 tokens as risk appetite selectively returned.
XRP and BNB posted smaller gains, staying range-bound as investors waited for clearer signals on the development of spot ETFs and broader market direction. Dogecoin rose but remained lower on a weekly basis, and continues to reflect broader sentiment rather than token-specific catalysts.
Oracle shares fell more than 11%, the biggest one-day drop since January, after the company revealed a sharp increase in capital spending tied to data centers and AI infrastructure.
Quarterly spending rose to about $12 billion, well above expectations, while the company raised its full-year capital spending outlook to about $50 billion, an increase of $15 billion from its September forecast.
That move raised new doubts about when AI investments will meaningfully translate into cloud revenue, pushing Oracle’s stock to its lowest level since early 2024 and sending a measure of its credit risk to a 16-year high.
The sell-off hurt broader tech sentiment, particularly in AI-linked names that have fueled much of this year’s stock rally. The Nasdaq 100 fell as investors cautiously rotated into other sectors, underscoring a growing sensitivity to spending discipline rather than top-line growth alone.
As markets digest both a more fractured outlook from the Federal Reserve and increasing scrutiny of the AI economy, investors appear willing to remain tactical.
Near-term direction is likely to depend less on political signals and more on whether earnings and liquidity can justify the next tranche of risk-taking across assets.
