World shares are mixed as Oracle’s earnings revive AI worries, hitting technology shares

MANILA, Philippines (AP) — World shares were mixed on Thursday after the U.S. stock market again approached its record high following the Federal Reserve’s cut in its main interest rate.

The Fed’s rate cut was widely expected, but comments by Fed Chair Jerome Powell encouraged hopes for more cuts in 2026.

However, some Asian technology companies saw sharp declines after Oracle, a bellwether in the artificial intelligence sector, reported weaker than expected earnings. Its shares sank 11.5% in aftermarket trading. The company’s spending spree in AI has some worried about its cash flow.

“Frankly, the report was not dramatically bad, but it came to confirm concerns around heavy AI spending, financed by debt, with an unknown timeline for revenue generation,” Ipek Ozkardeskaya of Swissquote said in a commentary.

The future for the S&P 500 fell 0.7% while that for the Dow Jones Industrial Average was 0.3% lower.

In early European trading, Germany’s DAX shed 0.1% to 24,106.63. Britain’s FTSE 100 edged 0.1% higher, to 9,664.09, while France’s CAC 40 rose 0.5% to 8,059.53.

In Tokyo, the Nikkei 225 index fell 0.9% to 50,148.82, pulled lower by a 7.7% drop in technology and telecoms giant SoftBank Group Corp., a major investor in AI.

Local shares are under pressure from growing expectations that the Bank of Japan will raise interest rates at its meeting next week.

Hong Kong’s Hang Seng shed earlier gains and shed less than 0.1% to 25,530.51 after the Hong Kong Monetary Authority followed the Fed’s lead and trimmed borrowing costs to 4.00%, their lowest rate since October 2022. The Shanghai Composite index fell 0.7% to 3,873.32.

Sentiment was cautious ahead of China’s November credit data. New yuan loans fell sharply in October, missing forecasts and showing weaker consumer demand.

Australia’s S&P/ASX 200 added nearly 0.2% to 8,592.00 after three days of decline, boosted by strength in gold and mining stocks. The country’s seasonally adjusted unemployment rate in November was unchanged from October at 4.3%, below the expected 4.4%

In South Korea, the Kospi shed gains in early session, falling 0.6% to 4,110.62. Chip maker SK Hynix fell 3.8% after the country’s main stock exchange issued warnings over its meteoric rise this year.

Taiwan’s Taiex index closed 1.3% lower, while India’s BSE Sensex rose 0.4%.

On Wednesday, the S&P 500 climbed 0.7% and finished just shy of its all-time high, which was set in October. The Dow Jones Industrial Average jumped 1% and the Nasdaq composite rose 0.3%.

Wall Street loves lower interest rates because they can boost the economy and send prices for investments higher, even if they potentially make inflation worse.

Wednesday’s cut to interest rates did not move markets much by itself. But some investors took heart from comments by Powell, which they said were less forceful about shutting down the possibility of future cuts than they had been anticipating.

Powell said again on Wednesday that the central bank is in a difficult spot, because the job market is slowing while inflation is facing upward pressure. By trying to fix one of those problems with interest rates, the Fed usually worsens the other in the short term.

Powell also said for the first time in this rate-cutting campaign that interest rates are back in a place where they’re pushing neither inflation nor the job market higher or lower. That gives the Fed time to hold and reassess what to do next with interest rates as more data comes in on the job market and on inflation.

On Wall Street, GE Vernova flew 15.6% higher after the energy company raised its forecast for revenue by 2028, doubled its dividend and increased its program to buy back its own stock. Palantir Technologies added 3.3% while Cracker Barrel Old Country Store rose 3.5%.

In other dealings early Thursday, U.S. benchmark crude oil slid 76 cents to $57.70 per barrel. Brent crude, the international standard, lost 80 cents to $61.41 per barrel.

The U.S. dollar was unchanged at 156.02 Japanese yen. The euro fell to $1.1692 from $1.1696.