Oracle’s Selloff Hits Global Tech Market

Core Insights - Oracle's stock experienced a significant decline of over 11% in after-hours trading following disappointing revenue and operating income results, disrupting the post-Fed calm and increasing pressure on global technology markets [1][2] - The market is now questioning whether the AI-driven expansion in cloud and data-center spending can justify current valuations, especially after Oracle's announcement of a $15 billion increase in capital expenditure for data-center capacity [2][7] Market Reaction - The selloff in Oracle's shares had a broad impact, causing European markets to open lower, with notable declines in tech indices and major stocks such as SAP [3] - Asian markets also closed weaker, with the Nikkei down 0.1% and significant drops in Softbank and other tech stocks, reflecting a cautious sentiment due to domestic liquidity concerns in China [5] Future Outlook - Upcoming earnings from Broadcom will be closely monitored, as strong guidance could stabilize market sentiment regarding AI infrastructure demand, while a weaker update could exacerbate concerns stemming from Oracle's performance [6] - The overall sentiment indicates that while interest in the AI boom remains, the tolerance for earnings misses is decreasing, highlighting the rising valuation risk and the increasing importance of corporate earnings confirmation over macro policy signals [7]