AI Bear Turn — The Projection

This week's evidence

Korea's "Black Tuesday" session closed −10–11% with circuit breakers — SK Hynix below $140 (−10-13%), Samsung down with it; China chip-competition fear compounding AI volatility. SK Hynix reports within 24h. ([Reuters/Korea Times]) 2026-07-28 · NEW

NVDA −5% · CDS record single-day gain on the firmed $250B guarantee. 2026-07-28 · NEW

The instrument panel (FRED, 07-27 close): HY OAS 2.81% (3rd session wider, +4bp), IG 0.81, 2s10s +34bp, VIX 18.67, Fed funds 3.63 — credit leaking wider, not cracking, against the CDS headlines. 2026-07-28 · NEW

FOMC-eve: hike odds ~25-35% and cooling (CME FedWatch ~34.7% options-implied 07-27; prediction markets ~25% today; a 77% September read says the bias is real but deferred). The driver reversed: Brent cratered to ~$84 (−4.8%, 3rd losing day) as the US–Iran fighting pause (07-24) held — after Houthis hit Saudi refineries directly 07-25, the first since 2022. Decision 14:00 ET tomorrow. 2026-07-28 · NEW

2026-07-28 — FOMC eve: mixed tape, rate odds still elevated

Going into tomorrow’s 2pm ET decision, the tape is mixed rather than uniformly bearish: CoreWeave −30% in a month, SpaceX touching a fresh post-IPO low (~$110.85, Morgan Stanley pricing its AI unit at zero), and Nvidia’s own CDS still wide — but Intel just posted its best quarter in 15 years (+25% revenue) and oil is now falling sharply (Brent −4.8% to ~$84 on the US-Iran pause), which cuts against one of the week’s own drivers of Fed hike odds. Breadth question from 07-27 stays open: still AI-specific + macro-crosswind, not one clean story.
Fed hike odds sit ~25-35% across trackers (CME FedWatch ~34.7% as of 07-27; a same-day FinanceFeeds read has it at 25%) — up from ~24% on 07-21, but consensus still points to a HOLD tomorrow with odds shifting to a September hike instead (77% per one prediction-market read). See the FOMC brief for detail. ⟨daily 2026-07-28⟩

2026-07-28 — Circuit breakers ⟨daily 2026-07-28⟩

Korea’s session closed −10–11% with circuit breakers triggered — SK Hynix below $140 into its own earnings; NVDA −5% + record CDS move the same day. Both legs of the turn fired at once, the day before FOMC.

2026-07-28 — The Seoul leg ⟨crawl 2026-07-28⟩

The turn went global: KOSPI −10.84% (“Black Tuesday”), SK Hynix −14.65% — triggered by CXMT’s debut rather than US capex anxiety, but the same repricing impulse. The bear-turn now has US (index bear territory, NVDA CDS) and Asia (Seoul) legs in the same week.

2026-07-27 — Opened ⟨steer 2026-07-27⟩

The AI-heavy index slid into bear-market territory (IBD); ASML plunged on China news; NVDA −4% on its own guarantee. Running tally into the turn: Mag7 −$797B (07-23), SpaceX ~50% off high, soft AI-debt demand (07-24), hike odds ~40% into Wednesday’s FOMC. Ben: distinct from circular-financing — “it’s its own thing.”