Asian shares wobble as AI spending fears spark biggest Treasury rally in over three years

Asian shares slipped on Friday after Wall Street’s tech sector took a hard fall overnight. The Nasdaq dropped more than 2% as worries grew about how much money the artificial intelligence boom actually needs. The more dramatic move came in bonds. US Treasuries posted their biggest single-day rally in more than three years, as investors traded growth stories for the comfort of government debt. From AI enthusiasm to AI anxiety The trigger was Meta Platforms. The company reported its first cash outflow in more than a decade, and its shares fell about 8%. Money moved quickly toward safety. Sovereign bonds and safe-haven currencies drew heavy demand as traders reduced risk. Bonds rally, rate hike bets fade The 10-year US Treasury yield fell 19 basis points to approximately 4.96%. A basis point is one-hundredth of a percentage point, so this was a big daily move for the world’s benchmark bond. Traders cut their expectations for further tightening from the Federal Reserve. They removed almost a full quarter-point rate hike from pricing for next year. A December rate rise is also no longer fully priced. The implied probability of a hike at that meeting dropped to 85%. Asia feels the chill ...