WSJ What’s News - Global Stocks Sink on Renewed AI Jitters

Episode Date: June 8, 2026

A.M. Edition for June 8. Markets across Asia and Europe are falling, tracking Friday’s Wall Street rout. WSJ editor Peter Landers says tech stocks–especially in South Korea–are being especially hard hit amid “extraordinary sensitivity” among investors over the outlook for future AI growth. Plus, Israel and Iran exchange fire for the first time in months. And Apple prepares to unveil a ChatGPT-like revamp of its Siri voice assistant in a bid to catch up in the AI race. Luke Vargas hosts. Sign up for the WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

One day, you're negotiating with suppliers. The next, you're installing a shelf in the back room. Running a business means moving in many directions all the time. TD's new small business banking accounts are built for how your business moves. It's how we're making banking more human. Global stocks sink on fresh investor concerns about a potential AI bubble. The South Korean market down 8% today. That is a reflection, really, of what investors expect about AI globally,

because these South Korean chip companies are serving a global market. Plus, the latest from Tel Aviv as Israel and Iran exchange fire for the first time in months, and an aviation trade group warns that a number of airlines may not survive the high energy prices brought on by fighting in the Middle East. It's Monday, June 8th. I'm Lou Vargas for the Wall Street Journal, and here is the AM edition of What's News, the top headlines and business stories moving your world today. Global markets are sliding today following Friday's Wall Street route that saw the NASDAQ fall by more than 4%.

Today, Japan's NICA was dragged lower by electronics and metal stocks, while trading of South Korea's Kaspi Index was halted twice in order to reduce volatility after it briefly fell more than 8% thanks to big declines by chipmakers Samsung and S.K. Hynex. Peter Landers is the Wall Street Journal's Asia Business Finance and Economics Editor and joins me now from Singapore. Peter, help make sense of what has set this off. There was, of course, a stronger than expected jobs report back on Friday that could play some role in it, leading people to believe the Fed might be raising rates this year. And then two days before on Wednesday afternoon, we had Chipmaker Broadcom release earnings saying that revenues were up, but it held its guidance for 2027 flat, which evidently sparked concerns

Is that chip demand may not be trickling through to higher profit margins? Is that enough to get us to where we are now? I think there's extraordinary sensitivity in the markets as to whether there is an AI bubble or not, and how fast AI is going to keep growing. We know it's growing super fast, and companies like Nvidia or TSM, S.K. Hynix, all of these companies that are connected to the AI boom are seeing extraordinary rises in sales and profits. So that's great. The only question is how quickly will profits continue to rise in the next couple of years?

And any hint that the rise may not be quite as rapid as expected can have a big impact on the market because the prices right now are reflecting anticipation that the growth will continue to be incredibly rapid for a long time. And just give us the logic on the jobs report, kind of the thinking here that potential rate hikes this year could put pressure on multinational companies? in particular, what's happening? Right. If the Federal Reserve did raise interest rates, it might reduce investment, perhaps, in AI or just send a shutter through the economy that would bring growth down generally and perhaps cast a chill over the AI boom. And again, anything that affects those growth forecasts really has the market on edge.

Something potentially like Wednesday's U.S. inflation report or on the AI narrative, what's bigger than SpaceX's IPO coming up on Friday? Right, and the IPO on Friday certainly will be a barometer of how much investors think this field is going to grow in coming years, because right now SpaceX doesn't have the kind of revenues that a company like Apple or Amazon does. Nothing like that, nothing close to that. So if you buy into a trillion-dollar-plus valuation for SpaceX, you're expecting amazing growth to continue for a long time. And it may well do that. And I think the IPO will be a test of what investors expect. That's the journal's Peter Landers. And to round out a busy week, the European Central Bank is set to announce its next-rate decision on Thursday with a hike likely. And back in the U.S., the University of Michigan's preliminary June consumer survey is due out on Friday.

In other markets news, seven major oil producers led by Saudi Arabia have agreed to boost output for a fourth straight month. Although some of the world's largest tankers have begun traversing the Strait of Hormuz in recent weeks, the production increase is seen as large. symbolic until flows through the waterway return to pre-war levels. And the trade group representing major global airlines is forecasting that some may not be able to weather disruptions caused by higher fuel prices that have halved the industry's profitability. Willie Walsh is the Director-General of the International Air Transport Association. If you were a small airline weak balance sheet, you weren't able to hedge, you would have been hit by a very significant increase in the fuel bill. And quite honestly, there are some airlines out there that unfortunately will not survive through this period.

The group also said that ticket prices will inevitably have to rise, but said its research suggests that travelers are expecting that. Israel and Iran have exchanged fire in a tumultuous resumption of violence that's testing President Trump's fragile Middle East ceasefire. The attacks and counterattacks marked the first time that Iran and Israel have targeted each other since the deal brokered by. the U.S. went into force in early April. Correspondent Dove Lieber is in Tel Aviv and is across developments. Dove, what exactly happened overnight and into this morning? Well, during the day yesterday, Israel struck Beirut for the first time since Iran had threatened to strike Israel directly if Israel strikes Beirut. And Iran fired 10 to 11 missiles at Israel overnight in four different waves of attacks. Iran said that those attacks targeted

military sites, especially air bases, inside of Israel. And in response, Israel also struck several different areas in central and western Iran, including a petrochemical plant, which is an important target for Israel because petrochemicals are important for the Iranian economy. Okay. Thanks for sketching out kind of the chain reaction here. It's very helpful. But we should know that President Trump, speaking yesterday, told Fox News and Axios that he was pressing Israel to stand down in response to this. And it seems like instead, Prime Minister Netanyahu has gone his own way here. That's true.

President Trump spoke to a number of journalists. But at the same time, President Trump and Prime Minister Netanyahu also spoke last night. And according to our reporting, President Trump had green landed at least a limited response by Israel. This has been a constant issue when it comes to the relationship between Netanyahu and Trump. There's their public posture and there's what they tell each other behind the scenes. That sort of dual narrative maybe makes this question hard to answer. But can we say what this latest flare-up may mean for the prospective piece in the Middle East? Well, one thing, it looks like President Trump seems determined to try to get to a deal as soon as possible.

That doesn't necessarily mean that a deal will come out as soon as possible because Iran, through its actions last night, seems to understand that President Trump really wants a deal. And therefore, it's trying to increase what it can get out of a deal. in this sense, for example, it's protecting its ally Hezbollah and Lebanon. So Iran is kind of projecting power across the region and sensing that it has the advantage in these talks. And probably the thinking on the Israeli side is, hey, if the U.S. and Iran have been able to have a number of exchanges militarily in the last few weeks and still say that the ceasefire is ongoing and talks continue, why should we be prohibited from opening up our military arsenal on occasion when it

helps us. Yeah, I think the Israeli perspective is slightly different because the talks aren't currently leading towards a deal that Israel will be super comfortable with. Iran is separating the end of war from the nuclear talks, which is difficult for Israel to accept because Israel doesn't allow its enemies to build up. So the Israeli perspective and the U.S. perspective are slightly different here, and that's precisely what Iran is doing. It's driving a reg in between the different interests between those two allies. Though to be very clear, it's not necessarily certain we're going back to full war that this exchange is necessarily going to continue. Absolutely not. It's hard to say where it will go from here. I mean, but it does leave an open question, which is what will happen with the Lebanese issue?

Because it doesn't seem that Hezbollah is going to stand down and it doesn't seem that Israel is going to stand down. So how can we achieve some kind of resolution here? Either Israel needs to back down or Iran needs to back down. And U.S. is sitting right in the middle. Dove Lieber is a journal Middle East correspondent. Dove, thank you so much for the time. Thank you for having me. Coming up, Xi Jinping heads to North Korea, the site of one of the world's most unlikely growth stories and can a more chaty-p-t like Siri power-up Apple in the AI race. We've got those stories and more after the break.

Chinese President Xi Jinping has landed in North Korea. Korea for his first official visit to the country since 2019. There is no agenda for the summit with North Korean leader Kim Jong-un, but our Korea bureau chief Tim Martin says that while the two leaders have a growing area of cooperation, she wants to exert more control over his neighbor. China has tremendous amounts of influence as North Korea's biggest benefactor and trade partner, but Kim Jong-un has really changed the dynamic between the two countries by getting much closer to Russia and Vladimir Putin. This makes Beijing uncomfortable. Russia and North Korea are okay with unpredictability of wars, of all types of activity that flout international norms. This is not

the China that she wants to see today. He wants China to be an upholder of the international order. So we have two countries and two leaders meeting in Pyongyang trying to resolve their differences. And we will see if she has sway with Kim. We know he does have sway with Kim. The question is how much? She's meeting with Kim Jong-un comes amid surprisingly strong momentum for the North Korean economy. The regime there doesn't release official economic data, though our reporting found that Pyongyang completed major construction projects had a surge in activity at oil facilities and saw a tripling of its nighttime brightness over the last five years. Tim says it's part of Kim's efforts to build a self-reliant economy. North Korea is subject to some of the most

powerful sweeping sanctions we've ever seen placed on an individual country for the better part of a decade. And this blocks North Korea's access to the global financial markets. So this survivability gives Kim Jong a strong hand, a strong hand not only to refuse to sit down, at least so far with President Trump during his second term, but it also gives him currency with Xi Jinping. China should have absolute sway over North Korea, but because of North Korea's diversity and how it makes money, who it's friends with, that now gives some more balance to a Pyongyang-Beijing relationship that has often been fraught over the decades. Back in Washington, a top Senate Democrat is introducing a bill to restrict how the Pentagon

uses artificial intelligence. We're exclusively reporting that the proposal from California's Adam Schiff would ensure that a human is involved when the Pentagon uses AI and weapons and would protect against the technology's use for domestic surveillance. It's the latest in a flood of proposals that offer a preview of what tech companies can expect if Democrats win back control of Congress. The Trump administration is unlikely to back the measure. And Apple's Worldwide Developers Conference kicks off today with the big reveal expected to be a revamped chat GPT-like Siri built on Google's Gemini technology. Apple is considered years behind some of its rivals in the AI race. The columnist Rolf Winkler said its formidable tech assets could help it to catch up

quickly. As far behind as Apple is in AI, there's an argument that is made by Wall Street analysts and they say, you know what, Apple could still win this, right? At least when it comes to consumer AI. Why? Because we all still use iPhones. If Open AI wants to reach people with chat GPT, it has to go through Apple. All of these companies long term still today have to go through Apple. So if Apple can finally create a Siri that is your guide to this AI world, this could flip. And for more on Siri's second act, check out our tech news briefing podcast, which we've left to link to in our show notes. And that's it for what's news for this Monday morning. Today's show was produced by Hattie Moyer.

Our supervising producer is Sandra Kilhoff, and I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a new show. Until then, thanks for listening. Thank you.