Stocks focused on artificial intelligence are under pressure on Friday, dragging down technology-related stocks and bitcoin. down during the early US session.
Chipmaker Broadcom (AVGO), the ninth-largest asset by market cap, fell 10% despite strong earnings as its outlook disappointed investors’ lofty expectations.
The Nasdaq index fell more than 1% in the first hour of the session. Add to that Oracle’s 10% drop on Thursday and another 3% drop on Friday, as investor concerns grow that the hot AI topic that fueled much of this year’s stock market gains could be fading.
Bitcoin, which was trading around $92,500 overnight, plunged 2% after the US stock market recently opened at $89,800, extending choppy action throughout the week. A consistent theme this week has been Bitcoin setting intraday lows during US trading hours, a pattern that has led to the introduction of the proposed AfterDark Hours ETF.
Bitcoin miners, some of whom have increasingly turned to AI to diversify, showed a similar reaction to the Broadcom failure. Hut 8 (HUT) fell more than 5%. Iren (RIEN) and Riot (RIOT) fell around 4%, while Cipher (CIFR) and Iren (IREN) fell around 2% over the past day.
Cryptocurrency-related stocks also fell along with the Nasdaq. Robinhood (HOOD) and Strategy (MSTR) fell almost 2%. Stablecoin issuer Circle (CRCL) was hit hard and fell more than 5%. Coinbase (COIN) fell slightly.
Markets had already been under pressure after Federal Reserve Chair Jerome Powell’s speech on Wednesday, which hinted at a possible pause in rate cuts in January. As a result, markets now expect only two rate cuts in 2026 instead of three. However, Chicago Federal Reserve President Austan Goolsbee, who opposed a rate cut in December, said he expects more in 2026 than the current median projection.
Several other members of the Federal Reserve will also speak later today, as the central bank’s blackout period following its December meeting on Wednesday has ended. Traders will look for guidance on whether Fed officials agree with Powell on keeping rates steady in January.
