Bitcoin Miners Down 13% Since July in Wall Street's Worst Selloff

TeraWulf, Core Scientific, Cipher Mining and IREN each lost more than 12% as intensifying inflation hit AI infrastructure companies harder.

TeraWulf, Core Scientific, Cipher Mining and IREN each lost more than 12% as stronger inflation hit AI infrastructure companies.

U.S. stocks suffered their sharpest sell-off since July on Wednesday as hotter-than-expected inflation data hit tech infrastructure and artificial intelligence companies, with bitcoin miners among the worst hit.

The S&P 500 fell 1.1%, its biggest one-day decline since July 29. The Nasdaq Composite fell 1.9 percent, its biggest one-day drop since July 23, while the Dow Jones industrial average fell 0.1 percent on the day.

Leading decliners among tech majors included data center operator CoreWeave, down 16 percent, artificial intelligence infrastructure provider Nebius, down 11 percent, and Oracle, down 9 percent.

Of the 23 AI infrastructure stocks tracked by data center PRISM's AI Infrastructure Index, 21 fell on Wednesday, with an average decline of 7.46%.

The one-day drop also extended to Bitcoin miners, a number of which have also expanded into AI infrastructure. TeraWulf fell 12.64% on the day, while Core Scientific, Cipher Mining and IREN fell 12.44%, 12.35% and 12.2% respectively. Riot Platforms, Bitdeer Technologies, MARA and CleanSpark also fell.

Higher interest rates could raise borrowing costs for AI infrastructure companies, many of which rely heavily on debt to finance data center expansion.

US consumer prices rose 3.7 percent in September from a year earlier, beating economists' expectations of 3.6 percent and well above the Federal Reserve's 2 percent target, with rising gasoline prices blamed on the Middle East war.

The inflation report also raised expectations for an October Fed rate hike. The implied probability briefly exceeded 50 percent on Wednesday before pulling back.

"I don't feel like we have to make a decision with a limited set of information," Daly said. I think we have the necessary time.