Stocks tumble as AI rout deepens, cryptos rebound

Global investors and major financial institutions faced a significant market retreat on February 6, 2026, as escalating fears regarding the sustainability of the artificial intelligence boom triggered a widespread sell-off across international stock exchanges. The downturn was primarily driven by investor anxiety over a projected $600-billion AI capital expenditure plan by tech giants Amazon, Microsoft, Google, and Meta, combined with data showing U.S. employer layoffs hitting a 17-year high for January. These factors fueled concerns that the massive financial outlays for AI infrastructure are not yet yielding sufficient returns, leading to the worst weekly performance for the MSCI All-Country World Index since mid-November. The impact was most visible on Wall Street, where the S&P 500 software and services index plunged 4.6% in a single session, contributing to a trillion-dollar market value loss termed by traders as 'software-mageddon.' Markets in Europe and Asia shared the burden, with the Stoxx 600 easing and the MSCI Asia-Pacific excluding Japan dropping 0.7%. Even traditional safe havens like gold and silver experienced extreme volatility, with analysts noting that precious metals are currently struggling to serve as reliable hedges against the intense risk-off sentiment dominating the global financial landscape. In the digital asset space, cryptocurrencies like Bitcoin and Ethereum managed a slight rebound following a period of intense selling that has erased approximately $2 trillion in market value since late 2025. Bitcoin recovered to the $64,000 range after briefly dipping toward $60,000, while ether posted modest gains to recoup some of its recent losses. Despite the stabilization in crypto, the broader market remains on edge as participants shift focus to the Federal Reserve's upcoming March meeting, with an increasing number of traders betting on a potential interest rate cut to bolster the cooling U.S. economy.