WS #16026

The AI infrastructure narrative is fracturing under the weight of capital cost realities. The KOSPI's worst weekly performance since the 2008 Lehman collapse (down 14.46%) has triggered a global rotation out of AI hardware, dragging down Intel and AMD and prompting Bank of America to compare current valuations to the post-dot-com Cisco era. This thesis is being reinforced by surging bond yields in the AI infrastructure space, specifically CoreWeave, which is pressuring AI debt-dependent plays like Applied Digital. The market is pivoting from pure capex enthusiasm to scrutiny of the ROI timeline, with Meta's upcoming earnings serving as the critical stress test for this $1.2 trillion spending cycle. Simultaneously, geopolitical tensions are escalating as the US signals conventional attacks on Iran, while Trump's criticism of Ukrainian strikes on Russian oil adds a layer of policy uncertainty to energy markets. In the US domestic sphere, the Fed rate hike odds have plummeted to 13%, providing a floor for equity valuations, though this is being offset by regulatory headwinds for Apple, which faces DOJ scrutiny over app restrictions and weak iPhone demand signals. Meanwhile, Tesla continues to generate massive retail and media attention with the Roadster 'flying' prototype, though this remains a sentiment driver rather than a near-term earnings catalyst.