Crypto Stocks Slide as Wall Street Tumbles Ahead of Inflation Data
U.S. equities closed sharply lower on Thursday as investors rotated out of technology shares amid growing concerns over AI-driven disruption and caution ahead of Friday's consumer price index report.
The S&P 500 fell 1.57%, while the Nasdaq Composite dropped 2.03% as tech giants bore the brunt of the selloff. The Dow Jones Industrial Average declined 1.34%.
Crypto-related stocks tracked the broader weakness, with digital asset names underperforming the market. Coinbase (COIN) slid 7.9%, while Robinhood (HOOD) fell 8.79%. UPXI led losses among crypto-exposed equities, dropping 8.91%. Coinbase stock is trading -56.79% over the past 6 months, while Robinhood is -37.66% in the same period.
The declines came as what analysts are calling a "$1.2 trillion AI scare trade" hammered logistics and software stocks, with investors dumping shares in Nvidia, Apple, and Amazon. The rotation reflects mounting uncertainty over AI valuations and their near-term impact on corporate earnings.
Markets are now focused on Friday's CPI release, which economists expect to show inflation at 2.5% year-over-year. A hotter-than-expected print could further pressure risk assets, including cryptocurrencies, by dimming hopes for Federal Reserve rate cuts.
Bitcoin was trading around $66,000 at press time, down roughly 2% over the past 24 hours.
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