Big Tech earnings tests investor confidence as AI stocks attempt recovery from sharp selloff

The rot may have started in Australia, where datacentre firm Firmus failed to list on the ASX. At one stage its float was on track to make it worth more than Telstra. This year an estimated $US1tn is being poured into AI. Analyst Gerard Minack of Minack Advisors says he is 'becoming more confident that returns on AI investment will disappoint'.

Should the AI boom collapse, investors are turning to credit default swaps as a hedge for their portfolios.

The 'magnificent seven' now account for 35% of the S&P 500, compared with 12% a decade ago.