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6h ago

AI Jitters Erase Nearly $1 Trillion From Big Tech in Worst Week Since April

Investors reassessed lofty AI valuations following Michael Burry’s $1.1 billion put disclosures, with deteriorating consumer readings intensifying the shift.

Jensen Huang’s Nvidia was one of those affected, and it has been shorted by the hedge fund manager Michael Burry
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Overview

  • The Magnificent Seven shed almost $1 trillion in market value this week, with the S&P 500 and Nasdaq tracking their weakest weekly performance since March.
  • Nvidia dropped about 13% for the week and Palantir slid roughly 17%, marking some of the steepest losses among AI-focused stocks.
  • Regulatory filings show Michael Burry’s Scion Asset Management disclosed about $1.1 billion in put options, including roughly $900 million tied to Palantir and $187 million to Nvidia.
  • Bank chiefs at Morgan Stanley and Goldman Sachs cautioned about potential equity drawdowns earlier in the week, and the VIX rose to a three‑week high.
  • The University of Michigan’s preliminary sentiment reading fell to 50.3 and October layoffs hit a 22‑year high, while questions over AI funding grew with reported OpenAI backstop talk that CEO Sam Altman publicly rejected.