U.S. stocks retreated Thursday after Oracle Corp. had its steepest decline in nearly a year, reviving concerns that heavy spending on artificial intelligence is straining balance sheets faster than it is generating returns.
Meanwhile, the crypto market traded with relative stability, diverging modestly from equity weakness as traders remained selective about risk.
Bitcoin traded back above $92,000, according to CoinDesk data, extending modest gains after holding key support earlier in the week. The largest token rose about 2.6% on the day, stabilizing after a volatile stretch that briefly dragged prices towards the low $90,000s.
Traders appeared to be more focused on maintaining trend structure than chasing upside, with flows concentrated in large cap assets.
“Major institutions are increasingly divided on the path forward,” analysts at Bitunix told CoinDesk in an email. “Some argue that an improvement in inflation supports further cuts starting in March, while others expect a pause in January, a wait-and-see approach through the first half of the year or even a delay in easing until after June.”
“Several Wall Street firms noted that this ‘hawkish cut’ highlights the FOMC’s growing difficulty in maintaining coherence under Powell’s leadership,” the email added.
Ether rallied alongside bitcoin, climbing towards $3,260, while SOL outperformed the majors with a jump of more than 6%, reflecting renewed interest in higher beta tier-1 tokens as risk appetite selectively returned.
XRP and BNB posted smaller gains and remained range-bound as investors awaited clearer signals on spot ETF developments and broader market direction. Dogecoin edged higher but remained lower on a weekly basis, continuing to reflect broader sentiment rather than token-specific catalysts.
Oracle shares fell more than 11%, the biggest one-day drop since January, after the company revealed a sharp increase in capital spending tied to AI data centers and infrastructure.
Quarterly spending rose to about $12 billion, well above expectations, while the company raised its full-year investment outlook to about $50 billion — up $15 billion from its September forecast.
The move raised fresh doubts about when AI investments will meaningfully translate into cloud revenue, pushing Oracle’s stock to its lowest level since early 2024 and sending a measure of its credit risk to a 16-year high.
The selloff weighed on broader tech sentiment, particularly across AI-linked names that have driven much of this year’s stock rally. The Nasdaq 100 fell as investors rotated cautiously into other sectors, underscoring the growing sensitivity to spending discipline rather than top-line growth alone.
With markets digesting both a more dovish outlook from the Federal Reserve and increasing scrutiny of AI economics, investors look set to remain tactical.
Near-term direction is likely to depend less on political signals and more on whether earnings and liquidity can justify the next leg of risk-taking across assets.
