A $40 billion selloff in a 141-year-old Japanese cable firm has served as a reality check on the fragility of the global artificial intelligence-driven stock rally.
Optical fiber cable maker Fujikura almost halved in value in the week through May 20 as investors rushed to dump its stock following a disappointing earnings forecast and lackluster medium-term plan. While the shares have since recouped some of those losses, they’re still trading almost 30% below their all-time closing high hit on May 13.
Fujikura’s roller-coaster week reveals how quickly the tides can turn for AI stock winners as investors realize hopes for explosive growth in infrastructure may have run far ahead of manufacturers’ ability to deliver.
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