Mixed labor data and AI uncertainty pressure global markets

Global stock markets are under pressure today as investors react to mixed U.S. labor market data and growing uncertainty around which companies will truly benefit from artificial intelligence (AI). These factors are fueling concerns about the strength and durability of economic growth, prompting a broad pullback in major indices. The latest U.S. weekly jobless claims report sent a confusing signal about the health of the labor market. New applications for unemployment benefits (initial jobless claims) fell to 227,000 from 232,000, which suggests layoffs are not accelerating sharply. However, continuing claims — the number of people still receiving unemployment benefits — unexpectedly rose to 1.862 million, higher than both the prior week and market expectations. This combination of fewer new claims but more people staying on benefits points to a labor market that may be cooling beneath the surface. For investors, this raises questions about whether consumer spending and corporate earnings can remain resilient if hiring slows further. At the same time, markets are dealing with a rotation within the AI theme. After a long period where anything tied to AI was rewarded, investors are now becoming more selective, trying to distinguish long-term “winners” from “losers” in the space. This reassessment is creating volatility across sectors linked to AI, from chips and cloud infrastructure to software and industrial automation. Because AI has been a major driver of global equity gains, any broad re-pricing of AI-related expectations can weigh on overall market sentiment. Together, the uncertain labor picture and the AI sector shakeout are driving a risk-off tone across global markets. Major U.S. benchmarks such as the S&P 500, Nasdaq 100, and Dow Jones Industrial Average are all down over 1% in midday trading, and this weakness is likely to influence sentiment in other regions as well. Until investors gain clearer evidence that the labor market remains healthy and that AI-related earnings can justify recent valuations, markets may remain choppy and cautious.