AI Spending Fears Haunt Stock Markets. Why Nvidia, Microsoft, Google Won’t Blink.

(Spencer Platt/Getty Images)

Artificial intelligence just isn’t getting the market excited like it used to. A flurry of AI announcements didn’t stop the stock selloff, but don’t bet on Big Tech companies backing away from their investments while private money continues to flow in.

A big deal like that struck between Anthropic, Microsoft , and Nvidia —through which the AI start-up will receive investment from the software giant and chip maker while spending tens of billions on cloud computing—would have sent stocks rocketing just a few weeks back. But investors look to be increasingly skeptical of how such circular arrangements will play out. Microsoft and Nvidia shares fell ahead of the chip maker’s earnings, which come after the close Wednesday.

The AI rally is clearly a source of concern. About 45% of fund managers surveyed by Bank of America in November listed an AI bubble as their top tail risk for markets—but 54% also said being invested in the Magnificent Seven stocks was the most crowded trade.

So will any of the tech companies blink? Google’s CEO Sundar Pichai sounded cautious when he said the industry might “overshoot,” speaking in a BBC interview Tuesday. But he also hailed the launch of his company’s Gemini 3 AI model as “a new era of intelligence.” Ultimately, defending Google’s dominant position in search takes precedence over saving money.

While public-market investors are fretting about shrinking cash flows, there is plenty of money still flowing into the sector. Elon Musk’s xAI is in advanced talks to raise $15 billion in new equity and Brookfield Asset Management is aiming to raise $10 billion for an AI infrastructure fund, according to The Wall Street Journal. Sovereign-wealth funds are willing to splash the cash—Saudi Crown Prince Mohammed bin Salman said in a meeting with President Donald Trump that he’s good for $1 trillion in U.S. investment, which includes a chunk for AI.

Investors might be feeling queasy about the carousel of circular deals and financing. But while private money and Big Tech executives are committed to AI, markets are locked in for the ride.

—Adam Clark

*** What’s Ahead for Markets in 2026? From “Liberation Day” tariffs to torrid rallies in AI stocks and gold, this year has been full of surprises. Join us on Dec. 11 at noon for discussions with investment strategists and money managers about the outlook for the economy and markets in 2026—and how to position your portfolio for success. Sign up here

Don’t miss Barron’s insights and analysis. Add us as a preferred source on Google.

***

Anthropic in Deal With Microsoft and Nvidia Amid AI Spending Concerns

Two of the biggest backers of artificial intelligence development start-up OpenAI are collaborating on a $15 billion investment in rival AI start-up Anthropic. It’s another example of the AI sector’s circular tie-ups, linking cloud computing and chip providers with the firms that build the AI models.

• Anthropic will buy $30 billion of computing capacity and up to one gigawatt of additional capacity from Microsoft to scale its flagship AI assistant Claude on the Azure platform. Nvidia will work with Anthropic to design its models. Nvidia’s investment is $10 billion, and Microsoft’s is $5 billion.
• It comes amid growing caution about the massive investments in AI and how they will generate profit. Anthropic said in September it raised $13 billion for an $183 billion valuation. Revenue has reached an annualized rate of $5 billion, up from $1 billion at the start of 2025.
• Microsoft CEO Satya Nadella said it’s no longer about “winner take all” attitudes. He urged the technology industry to move beyond those narratives and instead build broad durable capabilities together, “so that this technology can deliver real tangible local success.”
• But Alphabet’s CEO Sundar Pichai separately had a warning about overinvesting in AI, telling the BBC in an interview released Tuesday that there are moments in the investment cycle when the tech industry overshoots. “There are elements of irrationality,” he said.

What’s Next: Pichai was unveiling Google’s latest AI model called Gemini 3, which will be integrated into search, as well as the company’s Gemini app and developer tools. Asked how hard Alphabet would be hit if an AI bubble bursts, Pichai said: “No company is going to be immune.”

— Mackenzie Tatananni, Tae Kim, and Janet H. Cho

***

Meta Platforms Can Avoid Divesting Instagram, WhatsApp

In another instance of a tech giant avoiding the forced sale of a key business because the industry is evolving so quickly, a federal judge ruled that Meta Platforms isn’t an illegal monopoly. That means the Facebook parent can avoid selling its other social media brands Instagram and WhatsApp.

• The Federal Trade Commission sued Meta in 2020, claiming it bought competitors to maintain its monopoly in personal social networking. But District Court Judge James Boasberg said the industry has rapidly evolved, and the FTC failed to prove that Facebook still maintains the same power it once had.
• At issue was the definition of the market Meta was allegedly monopolizing. The FTC wanted a narrow definition of “personal social networks” to exclude competitors such as YouTube and TikTok. Each time the court examined Meta’s apps, they had changed, as had their competitors, Judge Boasberg wrote.
• Earlier this year, the government lost on forcing Alphabet’s Google to divest its market dominant Chrome search engine. While a federal judge agreed that Google used anticompetitive contracts to keep dominant in search, artificial intelligence chatbots were eroding that power, and the judge stopped short of ordering a sale.
• Meta’s Chief Legal Officer Jennifer Newstead told Barron’s that the court’s decision “recognizes that Meta faces fierce competition.” The FTC said it was deeply disappointed in the decision.

What’s Next: Judge Boasberg is presiding over other cases related to the Trump administration, including a fight over the deportation of an immigrant and some grand jury investigations into the Jan. 6 Capitol attack. An FTC spokesman said the agency was reviewing all its options.

— Adam Levine and Janet H. Cho

***

Prediction Markets In Focus as CFTC Nominee Heads to Hearing

Michael Selig, the nominee to chair the Commodity Futures Trading Commission, heads for a Senate confirmation hearing later today, and that will likely include questions about prediction markets, the proliferating sites where people can trade contracts on the outcome of events. They fall under the agency’s purview.

• Since President Donald Trump’s second term began, the CFTC hasn’t stopped prediction markets from expanding into event contracts that closely resemble sports betting. Republicans on the Senate Agricultural Committee didn’t press the issue of prediction markets during a June hearing for a previous CFTC nominee.
• The president’s son, Donald Trump, Jr., advises two prediction market operators Kalshi and Polymarket and his hedge fund has invested in the latter; President Trump’s social-media platform, Truth Social, recently announced plans to offer event contracts of its own.
• Sports betting giants DraftKings and Flutter Entertainment’s FanDuel have also been pushing into prediction markets and that has prompted them to quit the American Gaming Association, the powerful gambling industry lobbying group that’s opposed to the spread of prediction markets.
• Both companies said they no longer aligned with the AGA on certain issues. It was the AGA that fought hard to overturn the federal ban on sports betting, backing a 2018 Supreme Court ruling that took sports betting out of the government’s control and enabled the rise of DraftKings and FanDuel.

What’s Next: The AGA has been consistently opposed to prediction markets, in part because they don’t have to pay state taxes or abide by the consumer safety regulations established by state regulators. The AGA said in a statement that it wishes DraftKings and FanDual the best.

— Nick Devor

***

How the Government Shutdown Will Affect Thanksgiving Travel

The government shutdown is over, but the hangover from it isn’t. Many people rethought their holiday travel plans during the 43-day shutdown, which culminated in significant flight cuts at dozens of major airports, according to travel industry data. That could mean less crowding at airports for Thanksgiving travelers.

• This year fewer people have purchased flights for Thanksgiving weekend compared with 2024. Through last Friday, bookings were down 3.3% compared with last year for the period starting the Wednesday before Thanksgiving and ending on the Sunday after, according to aviation analytics firm Cirium.
• The steepest decline came in the first two weeks of November, with bookings falling nearly five percentage points compared with the end of October, when they were actually up slightly. Travelers are also being extra cautious. Travel site Hopper shows a 30% increase in customers adding travel disruption assistance.
• It’s potentially bad news for U.S. airlines. CFRA analyst Ana Garcia said they are now expecting fourth-quarter revenue to be softer because of the weakness in bookings that could take time to recover. Delta Air Lines CEO Ed Bastian suggested in recent interviews that it would affect results.
• Of course, people are still traveling for the holiday. AAA is forecasting that air travel will increase 2.1% this year, the same rate as in 2024, for a total of 6.07 million air travelers. Flights prices are averaging around $700 round-trip, according to AAA, about the same as last year.

What’s Next: What hasn’t changed is when the busiest travel day of the year will be. It is expected to fall on the Sunday after Thanksgiving, when nearly 3.3 million people are expected to fly, according to Cirium.

— Anita Hamilton

***

DJT Stock Has Cratered, Wiping $5 Billion Off Trump Family Wealth

Trump Media & Technology Group , the social media and crypto company, is trading near all-time lows as Bitcoin and other tokens keep plunging. The value of the Trump family’s holdings has now fallen by more than $5.3 billion since May 2024.

• The stock, known by its ticker DJT, closed 0.7% lower at $10.77 Tuesday after hitting an intraday low of $10.32—the lowest price since DJT’s predecessor company Digital World Acquisition Corp announced in October 2021 it had entered a merger agreement to take Trump’s social networking company public.
• President Donald Trump indirectly owns nearly 115 million shares of DJT that are held in a revocable trust in the name of son Don Jr. The son sits on Trump Media’s board. The holdings make the Trump family the company’s largest shareholder.
• DJT stock has fallen nearly 70% this year and 34.6% in the past month. The Trump family’s holdings at their peak in mid-May 2024 were worth nearly $6.5 billion.
• Bitcoin prices briefly dipped below $90,000 Tuesday, for the first time in seven months. In August, Trump Media announced it had acquired $2 billion in Bitcoin and related securities.

What’s Next: The stock rallied ahead of last November’s election as it was seen as a proxy for Trump’s chance of victory. These days it’s more reliant on Bitcoin prices, which for the moment, are under pressure.

— Joe Light and Callum Keown

***

Dear Quentin,

I’ve managed to acquire one bitcoin. I’m a 51-year-old single woman, and I’m a fully signed-up bitcoin owner. Given the volatility, I don’t want to cash it in because I don’t think the crypto market is bubblish. When I first bought bitcoin it was $48,000, and it went down to $16,000. I bought it at the wrong time, but anyone who has ridden the storm once isn’t worried about this downturn, and they’re buying furiously. My car is a piece of ****, but there’s no way I’m spending any money on anything other than bitcoin.

With bitcoin, there is a limited supply and it’s not run by one organization or one person. A big drop happens every couple of years, and it’s normally what happens before a huge pump. The general consensus is that there’ll be a huge pump at the end of the year to $200,000. You’ve had banks and nation states buying into bitcoin, and ETFs. I’m not a financial whiz kid, but investors trying to bring the price down so they can buy as much as possible, trying to scare the weaker hands.

My retirement is completely in bitcoin. That is, I invested in Strategy, a bitcoin treasury company. That’s because of my faith in Strategy CEO Michael Saylor. Strategy buys bitcoin and sells shares of their company. I’m not a bit worried and I would lose lots of money if I sold today. When I bought bitcoin 2021, I didn’t fully understand it. But I do know it’s not something that should not be traded. Once you understand that, you buy and you hold. If I had money, I’d buy the dip.

I also borrow against bitcoin. Firefish, a non-custodial, peer-to-peer lending platform, puts your bitcoin into escrow. With Firefish, bitcoin borrowers lock their bitcoin as collateral in wallets, while investors fund these loans for yield. This is all governed by code for security, and avoids central custodians. I apply for a loan, lock in my bitcoin in an on-chain escrow, and receive funds; if I default, my collateral is liquidated to repay the lender, preventing me from selling your bitcoin, but ensuring lenders get paid.

Why don’t more people do what I’m doing? What’s the catch? I don’t see one.

— Fiftysomething Bitcoin Fan

Read the Moneyist’s response here.

— Quentin Fottrell

***

—Newsletter edited by Liz Moyer, Patrick O’Donnell, Callum Keown