{"id":578097,"date":"2025-11-18T10:43:35","date_gmt":"2025-11-18T10:43:35","guid":{"rendered":"https:\/\/www.europesays.com\/uk\/578097\/"},"modified":"2025-11-18T10:43:35","modified_gmt":"2025-11-18T10:43:35","slug":"global-stocks-slide-as-valuation-fears-grow-ahead-of-nvidia-earnings","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/uk\/578097\/","title":{"rendered":"Global stocks slide as valuation fears grow ahead of Nvidia earnings"},"content":{"rendered":"

Global equities\u00a0tumbled\u00a0Tuesday as concerns of inflated valuations\u00a0and an\u00a0uncertain macro environment\u00a0grips\u00a0investors\u00a0ahead of Nvidia<\/a> earnings this week.\u00a0\u00a0<\/p>\n

The pan-European Stoxx 600<\/a> opened in negative territory on Tuesday with\u00a0mining-linked stocks and banks leading Europe’s\u00a0losses.\u00a0The\u00a0Stoxx\u00a0Europe 600 Technology Index\u00a0shed 1.4%,\u00a0following in the footsteps of U.S. stocks as fears of an artificial intelligence-fueled bubble persist.\u00a0\u00a0<\/p>\n

The three major U.S. indexes,\u00a0Dow Jones Industrial Average,<\/a>\u00a0the\u00a0S&P 500<\/a>\u00a0and tech-heavy\u00a0Nasdaq Composite,<\/a>\u00a0ended\u00a0the\u00a0previous\u00a0trading session\u00a0in the red. Asia-Pacific markets were also lower<\/a> on Tuesday, led by declines in Japan and South Korean benchmark indexes.<\/p>\n

Mike Gallagher, director of research at Continuum Economics, said the market action implies equities could fall about 5% from recent highs \u2014 or “a bit more.”<\/p>\n

He told CNBC’s “Squawk Box Europe” that the sell-off is\u00a0“natural profit taking”\u00a0following\u00a0a strong market\u00a0run since April.\u00a0\u00a0<\/p>\n

Stock Chart IconStock chart icon\"hide<\/p>\n

An interactive chart showing Europe’s Stoxx 600 index<\/p>\n

It all comes on the backdrop of AI bubble fears and the market holding tight for Nvidia’s\u00a0third-quarter\u00a0earnings, which\u00a0are due after Wednesday’s close. Nvidia\u00a0is seen an important bellwether<\/a>\u00a0for the AI industry as many of\u00a0the\u00a0largest players rely on its\u00a0GPUs.\u00a0\u00a0<\/p>\n

The recent earnings seasons shows that the big hyperscalers are still getting lots of revenue coming through 2026-27, Gallagher said, adding that investors are watching Meta<\/a> closely because without a server business it serves as an indicator of whether the next wave of AI applications can deliver revenue. “That suggests this is just a routine, healthy correction,” he said.<\/p>\n

Tema ETF Chief Investment Officer\u00a0Yuri\u00a0Khodjamirian\u00a0put the sell-off down to a “healthy dose of\u00a0skepticism” as the market realized that the mega-deals announced over summer need to\u00a0actually be\u00a0funded\u00a0somehow. He pointed to OpenAI’s\u00a0“massive announcements of commitments<\/a> to spending on GPUs, power data\u00a0centers,” and\u00a0said\u00a0“the market is starting to realize that this is going to\u00a0maybe be\u00a0a slower process than they thought in the summer.”\u00a0\u00a0<\/p>\n

“There is this kind of balancing going on in the market, and this is what\u00a0you’re\u00a0seeing in some of these shares. Oracle<\/a>‘s share price is back to where it was pre-the OpenAI announcement, so we think\u00a0it’s\u00a0reasonably healthy. The dynamics continue, these data\u00a0center\u00a0build outs, whether you listen to Microsoft<\/a>, Meta, Nvidia, etc,\u00a0they’re\u00a0all going in the direction of upwards.\u00a0Nothing’s\u00a0really stopping, so what\u00a0we’re\u00a0seeing is just a healthy correction, in a way, in the marketplace,”\u00a0Khodjamirian told CNBC’s Silvia Amaro.<\/p>\n

However,\u00a0Gallagher\u00a0noted that there is\u00a0an element of de-risking amid an uncertain macro environment. Investors are uncertain about a previously-expected Fed rate cut in December, he said, adding that\u00a0the central bank will “probably” now pause in the first quarter of 2026.<\/p>\n

“Then,\u00a0all of a sudden, that kind of driver\u00a0that’s\u00a0helped risk is no longer there.\u00a0We’ve\u00a0also got the Supreme Court in the U.S. due to judge on Trump’s\u00a0reciprocal\u00a0tariffs<\/a>.\u00a0It’s\u00a0actually a\u00a050-50 call, whether half of them or all of them are stopped, and that then gets us back into April’s cycle drama about new types of tariffs,”\u00a0Gallagher said.\u00a0\u00a0<\/p>\n

“So\u00a0there’s\u00a0some things coming over the horizon that make you want to take a bit of risk off the table.\u00a0So,\u00a0part of it is just natural pocket taking, part of it is thinking,\u00a0‘well, is the macro story going to be perfect? No,\u00a0it’s\u00a0not,'”\u00a0he\u00a0added.\u00a0<\/p>\n

“To get a major sell off, you may need major bad news, and that we haven’t actually got to that point yet,”\u00a0Gallagher said.\u00a0<\/p>\n

There is some exaggeration in cryptocurrencies due to leverage,\u00a0he\u00a0added. Bitcoin has shed around 25%\u00a0since its October high, and Ether has dropped 35% since its August high.\u00a0Industry experts told CNBC<\/a>\u00a0that\u00a0the sector is facing pressures from both\u00a0an\u00a0initial\u00a0macro-driven sell-off\u00a0and\u00a0forced liquidations.\u00a0\u00a0\u00a0<\/p>\n

Khodjamirian\u00a0is taking a multi-year view. The CIO said one looming problem is access to electricity. “There’s a realization from executives around, in the United States and in the world, that you need to provide power to these data\u00a0centers. That is going to be a big, big problem, and that potentially slows down the build out as more power needs to be built,” he said.\u00a0<\/p>\n

“We think\u00a0it’s\u00a0the biggest problem and the biggest bottleneck for building out the AI revolution, but also other things like the rebuilding of the industrial base, both in Europe and in the United States, electric vehicles, digital currencies,” he added.\u00a0\u00a0<\/p>\n

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