AI sell-off cools financing costs, and small-cap stocks welcome benefits

According to Woofun AI, Richard Bernstein, head of macro strategy at Janus Henderson, proposed that the sell-off of AI-related stocks may create a favorable environment for small-cap stocks by reducing overall financing costs.

On Thursday, a key chip ETF fell nearly 14% from its October high, triggering a market alert. Bernstein told CNBC that this is a healthy revaluation of asset prices. Capital has poured into AI data centers, causing other companies to run out of capital; if valuations are adjusted, economic financing costs will drop.

Data compiled by Woofun AI showed that despite the rise in small-cap stocks in recent trading days, the overall performance of the week was negative. Credit default swap (CDS) spreads reflected profit concerns, and chip stocks fell for 8 consecutive trading days, making the longest record since 2008.

Bernstein refuted expectations that the Federal Reserve would raise interest rates only once. On September 16, 2026, the Federal Reserve raised interest rates by 0.25 percentage points, the first time since July 2023. He pointed out that consumer prices, producer prices, and import prices are high, and core import prices are growing faster than core consumer prices, reversing the trend of the past 30 years, and the US is importing inflation. The consumer goods industry is performing slightly better, and the market is now worried about a recession.

Peter Schiff thinks most US stocks are in a bear market. According to Goldman Sachs (GS.US) estimates, the median S&P 500 constituent stocks retreated about 16% from their respective peaks. Bernstein acknowledged that a weak market is bad for the chip and technology industry, but long-term trends will not be completely constrained by the dominant factors of the past two or three years.