Goldman Sachs: Neocloud Stocks Plunge Amid High-For-Longer Rate Fears

CoreWeave (CRWV) and Nebius (NBIS) stocks have fallen approximately 15% over five days, reflecting broader concerns about the AI economic system rather than just CoreWeave's specific financial health. Goldman Sachs attributes this pressure to higher-for-longer interest rates, noting that US dollar high-yield AI-related debt spreads widened by 25 basis points between October 13 and 14 to a record of 360 basis points over Treasurys. Strategist Amanda Lynam identified neoclouds and firms with frontier lab exposure as the epicenter of this funding cost debate, contrasting them with more resilient energy and utilities sectors that benefit from diversified revenue streams. Meanwhile, CoreWeave shares plunged an additional 20% in early sessions due to record-high default protection costs and swaps pricing a over 60% chance of default within five years. Nvidia CEO Jensen Huang defended the company's financial position on Thursday, emphasizing its strength despite ongoing debt pressures while noting his dual role as both a CoreWeave investor and a major supplier.