The AI selloff reversed course on Monday. The Philadelphia Semiconductor Index surged more than 3% at one point during the session before paring gains, ultimately closing up 1.6%. The "AI capex peak" panic that had gripped the market was repriced as multiple Wall Street analysts continued to express confidence in underlying fundamentals.
The rebound covered the areas hit hardest last week. SanDisk closed up 5.3%, SK Hynix ADRs closed up 4.7%, Micron Technology (NASDAQ: MU) closed up 3%, and Intel (NASDAQ: INTC) closed up 2.4%. South Korea's KOSPI index staged a deep-V reversal to close up 1.76%, with Samsung Electronics recovering from an early-session drop of more than 4% to close up 1.16%.
Goldman Sachs on Monday upgraded CoreWeave, Inc. (NASDAQ: CRWV) from Neutral to Buy, arguing that the stock's valuation has become attractive after the sharp decline.
Star tech analyst Dan Ives cited CoreWeave's approximately $104 billion backlog at the end of the second quarter, noting that demand-side "already-locked-in customer commitments" remain intact. UBS Wealth Management's CIO simultaneously raised its 2026 global AI capex forecast to $900 billion, representing 84% year-over-year growth.
Goldman Sachs Upgrades CoreWeave to Buy: Debt Concerns Overblown
Goldman Sachs upgraded CoreWeave, Inc. (NASDAQ: CRWV) from Neutral to Buy, issuing a clear bullish signal for the cloud computing company after it experienced severe volatility driven by debt concerns.
Last week, CoreWeave shares plunged 25% in a single week, marking the largest weekly decline since November of last year. The trigger for the selloff was the company's bond prices falling to levels that typically signal financial distress, while the cost of protection against a bond default briefly climbed to a record high during intraday trading. The stock surged as much as 7.4% intraday on Monday before reversing to close down 0.4%.
Goldman Sachs analyst Gabriela Borges acknowledged that the market has legitimate concerns about whether and at what pace CoreWeave, Inc. (NASDAQ: CRWV) can finance its next phase of growth, but argued that the stock's valuation has become attractive after the sharp selloff.
She wrote in her research note: "We estimate that CoreWeave's blended debt cost may rise by 100 to 200 basis points, but most likely will not exceed this range, which effectively sets a ceiling on the upside for the weighted average cost of capital (WACC), keeping the equity return structure attractive."
Borges further noted that the company's internal rate of return (IRR) has "upside bias" over the next 24 months, citing tight current supply conditions and CoreWeave, Inc.'s (NASDAQ: CRWV) differentiated competitive advantages in performance and cost metrics as well as execution capability in new capacity expansion compared to other emerging cloud service providers.
Goldman Sachs lowered its price target for CoreWeave, Inc. (NASDAQ: CRWV) from $139 to $106, but even so, that still implies more than 40% upside from the stock's Friday close. According to Bloomberg data, the current average analyst price target for CoreWeave is $135.23, implying approximately 120% upside.
Multiple Wall Street Analysts Remain Bullish on the Outlook
The Philadelphia Semiconductor Index had closed lower for eight consecutive trading sessions through Friday, marking the longest losing streak since 2008, with a cumulative decline of more than 13% and approximately $2 trillion in market value erased.
Moor Insights & Strategy founder Patrick Moorhead said bluntly: "I think this is just another round of panic... because the AI trade has risen so much, people are now looking for reasons to sell rather than reasons to buy."
Dan Ives compared the selloff to a "SaaSpocalypse" moment for the AI infrastructure sector and expects that after the panic subsides, fundamentals-driven upside will resume. He noted that CoreWeave, Inc. (NASDAQ: CRWV) had approximately $104 billion in backlog at the end of the second quarter, which represents finalized customer commitments rather than tentative demand.
UBS Wealth Management's CIO research note provided support from the capex aggregate level, raising its 2026 global AI capex forecast to $900 billion, up 84% year-over-year, and further to $1.2 trillion in 2027, up 33% year-over-year. The direct trigger was a broad cost increase across the AI server supply chain recently.
Market Divergence Persists, Attention on U.S. Short-Term Liquidity Risks
Bank of America strategist Michael Hartnett previously warned that risk-averse sentiment could dominate the market in the coming weeks as investors seek to hedge against volatility from rising interest rates, U.S. midterm elections, and AI-themed trades.
CICC noted in its report "American AI in the 'Marshmallow' Era" that U.S. short-term liquidity risks should not be overlooked, and there is a possibility of liquidity tightening beyond expectations. Once that occurs, it would ripple across global markets, and market concerns about the sustainability of AI companies' capital expenditures could also intensify.
Huaxin Securities noted that it is cautious on U.S. equities in the short term, with a defensive bias. AI trading has clearly cooled over the past week. Healthcare, consumer staples, and utilities can serve as phased defensive allocations.
Guolian Minsheng Securities believes that U.S. inflation exceeding expectations has pushed up Treasury yields, compounded by Anthropic's slowing revenue growth in the third quarter of 2026 and widening credit spreads for compute operators such as CoreWeave, Inc. (NASDAQ: CRWV), market concerns about the sustainability of AI capital expenditures and investment returns have intensified. In the short term, highly leveraged and highly valued names may continue to face pressure.
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