Global Markets Rise Amid AI Bubble Concerns: Sector Rotation and Tech Stock Volatility

Based on the Wall Street Journal article [1], global markets rose ahead of Thanksgiving 2025, with the FTSE 100 up +0.19% on November 24 [0]. However, the Tech sector underperformed, gaining only +0.15% compared to Healthcare (+1.73%) and Industrials (+1.52%) [0]. AI-related stocks saw significant volatility: NVDA fell -7.81% on November 20, MSFT -2.90%, GOOGL -4.96%, and META -2.38% [0]. Some stocks rebounded slightly: GOOGL (+1.09%) and META (+0.98%) on November 21 [0]. This indicates sector rotation from Tech to defensive sectors amid AI bubble concerns [0].

1. Tech Underperformance
   : Even as global markets rose, the Tech sector lagged, reflecting persistent investor caution about AI bubble risks [0].
2. Mixed AI Stock Reactions
   : While initial drops were sharp, partial rebounds in GOOGL and META suggest selective buying interest [0].
3. FTSE Outperformance
   : The FTSE 100’s gain is likely due to its lower exposure to Tech compared to U.S. indices [0].

• Risks
  : AI bubble fears could trigger further Tech selloffs [1,2]. Regulatory risks (EU AI Act guidance expected by end-2025) may impact AI-related companies [3].
• Opportunities
  : Defensive sectors like Healthcare and Industrials may continue to outperform as investors mitigate AI bubble risks [0].

Global markets showed gains pre-Thanksgiving, but the Tech sector underperformed. AI-related stocks experienced significant volatility, with some partial rebounds. Sector rotation to defensive sectors is ongoing, driven by AI bubble concerns.