LIVE MARKETS — What's next for the AI trade?

(Adds new blog) STOXX 600 up 0.6%, set for weekly gain Asia shares bounce as tech worries ease Defence, autos lead S&P futures higher Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at What's Next For The Ai Trade? AI-linked stocks, especially those in the hardware and semiconductor space, have come under sharp selling pressure this week, as investors question the durability of the capex cycle. The selloff has sent ripples through some markets, with South Korea's Kospi and the US semiconductor index falling 14% and 8%, respectively. Barclays believes that positioning, rather than a meaningful deterioration in fundamentals, was behind the weakness, with investors happy to take profits on any negative headlines. So where to next for the AI trade? "We think the AI thematic is entering a more mature phase, where valuations, funding requirements, competitive threats, regulation, and revenue visibility are coming under much greater scrutiny," write Barclays equity strategists, led by Emmanuel Cau. "It is certainly conceivable that the best of the AI thematic trade may be behind us, and therefore we think inves