14.11.25 - Turning point: AI weakness and Fed signals shake markets

After months of relentless momentum, markets are finally taking a breather. AI valuations—previously treated as untouchable—are coming under renewed scrutiny. Profit-taking is accelerating just as investors start to question it.

At the same time, the macro backdrop becomes more complicated. With the government shutdown delaying key releases such as CPI and labor market data, investors are effectively flying blind. The Federal Reserve’s latest remarks leaned noticeably hawkish, and the market is beginning to doubt that a December rate cut is still on the table.

The combination of valuation doubts, missing data, and a firmer Fed, creates a fragile environment with sentiment turning quickly.

Markets: global sell-off and risk-off stance

• US Futures again lower led by tech stocks with Nasdaq future -1.3%

• US 10-year yield: dropped not massively to 4.08%

• Gold: sees larger swings now trading above USD 4’100/oz

• USD: slightly down

• CHF: strengthens

• Cryptos: sell-off massively with Bitcoin dropping below USD 95k

• Volatility: accelerates

My View: The long-awaited correction is finally here, and it was overdue.

AI stocks pushed too far in a euphoric environment where no one questioned sustainability, whether the sector can justify its massive capital expenditure with real, scalable earnings.
The narrative focused solely on investment—massive AI Capex—while almost no one asked the key question: How will these billions or trillions translate into earnings? What exactly is the business model?

Now the tide is turning. Everyone tries to get out of the same door at the same time, and liquidity disappears fast.

I would wait before buying the dip.
We haven’t seen the “big selling wave” yet, the kind that produces forced liquidations and margin-call washouts with everything moving in the same direction, down. That moment tends to reset positioning and offer genuine opportunities.

Watch also for political noise. A single Trump comment, just as we’ve seen many times, can suddenly stabilize sentiment or trigger a short-term bounce. But structurally, AI needs to prove profitability, not just Capex excitement.

This correction is healthy. It clears the excess, resets risk appetite, and brings back realism and forcing the gamblers out of the market.
The next good entry point will come, but not before the market flushes out the leverage.

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