The AI bubble is bursting, and the tech world is feeling the gravity. But is this a temporary dip or a sign of a larger market correction?
CNBC Daily Open: AI Euphoria Meets Reality Check
Jensen Huang, CEO of NVIDIA, took the stage at the GPU Technology Conference in Washington, DC, on October 28, 2025, amidst a backdrop of contrasting market signals.
While tech giants like AMD exceeded expectations on AI chip demand, and Palantir continues to impress with its growth, the Nasdaq's decline hints at a market obsession with AI that may be blinding investors to other opportunities.
Here's the twist: despite their stellar performances, Palantir's stock took a hit, and even AI leaders like Nvidia and Amazon saw pullbacks. This raises a crucial question: is the market's AI fixation sustainable, or is it a bubble waiting to burst?
Market Insights:
- SoftBank's Slide: Shares plummeted, wiping out $32 billion in market cap, as investors grew cautious of inflated valuations in the AI sector. This drop reflects a broader trend in Asian AI-linked companies.
- Private Equity Consolidation: The number of private equity funds in North America outnumbers McDonald's franchises, according to KKR & Co's co-CEO Joe Bae. This surprising statistic highlights the impending consolidation in the PE industry as investors seek better returns and governance.
- Democratic Sweep: Democrats dominated the U.S. elections in New Jersey, Virginia, and New York, with Zohran Mamdani, a democratic socialist, winning in New York City.
- Asian Markets Retreat: Japan's Nikkei and South Korea's Kospi suffered significant losses as investors abandoned AI-related stocks, impacting chip giants like Samsung and SK Hynix.
- Correction or Crash? Ritholtz Wealth Management's CEO, Josh Brown, suggests the stock market is undergoing a
