Alphabet’s huge capex plans rattled tech, while central banks held rates and investors digested falling oil and sliding metals.
What’s going on here?
Global stocks slid again after Alphabet signaled as much as $185 billion in capital spending, reviving fears that the AI buildout is getting too pricey.
What does this mean?
Alphabet’s number landed well above expectations, putting the spotlight back on a key question: how long can Big Tech bankroll chips, data centers, and power before earnings catch up? The selloff spread across the sector – chip-related names fell too – as investors treated the update as a read-through for everyone’s AI budgets. At the same time, central banks didn’t offer much clarity: the European Central Bank held rates at 2%, while the Bank of England held at 3.75% but with a close 5–4 vote that nudged traders toward expecting an earlier cut. Elsewhere, oil slipped toward $68 a barrel on renewed US–Iran talks.
Why should I care?
For markets: AI’s price tag is becoming the new stress test.
When a mega-cap like Alphabet talks about spending up to $185 billion, it pushes investors to revisit margin assumptions across the whole AI supply chain, from chips to cloud. With Amazon reporting next, its capex tone could shape expectations for whether the sector is staying disciplined or doubling down.
The bigger picture: Central banks are pausing but uncertainty isn’t.
Rate holds in Europe and the UK suggest policymakers want more evidence before moving again, which can keep borrowing costs elevated even if inflation cools.
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Originally Posted February 5, 2026 – AI Spending Jitters Drag Markets Lower Again
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