Nebius Group N.V. (NASDAQ:NBIS) stock traded lower Thursday as artificial intelligence infrastructure stocks faced selling pressure amid growing concerns over the debt needed to fund rapid AI expansion.
The decline came as technology stocks lagged the broader market. The Nasdaq fell 0.63%, while the S&P 500 edged up 0.07%. The technology sector dropped 1.4%.
Rising Borrowing Costs Pressure AI Infrastructure Stocks
Investors are increasingly concerned about the massive capital spending required to build AI data centers and expand computing capacity.
Companies such as Nebius rely on substantial infrastructure investments to support growing demand for AI computing services. As a result, higher borrowing costs could make expansion more expensive and weigh on future profitability.
Meanwhile, U.S. inflation and producer price data released this week added to concerns that interest rates could remain elevated for longer.
The outlook has also pressured high-yield credit markets, raising financing risks for capital-intensive AI companies, according to Benzinga Pro.
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Technical Analysis
Nebius shares traded at $175.45, slightly above their 200-day simple moving average (SMA) of $173.57.
However, the stock remained 22.4% below its 20-day SMA of $225.92 and 21.4% below its 50-day SMA of $223.02.
The sharp decline below these shorter-term averages signals weakening momentum.
Meanwhile, the moving average convergence divergence (MACD) indicator remained below its signal line, with a negative histogram. Both readings suggest bearish momentum.
Despite the recent weakness, the 20-day SMA remains above the 50-day SMA, which is still above the 200-day SMA. This alignment points to a longer-term uptrend.
Traders are watching support near $164.50. A break below that level could signal further downside.
Analyst Outlook
Wall Street maintains a consensus Buy rating on Nebius, with an average price forecast of $272.62 across 24 analysts. Forecasts range from $84 to $410.
Recent analyst actions include Rosenblatt initiating coverage with a Buy rating and a $304 price forecast on Oct. 8.
William Blair initiated coverage with an Outperform rating on Sept. 30. Meanwhile, BNP Paribas upgraded the stock to Outperform on Sept. 24 and raised its price forecast to $399.
NBIS Price Action
Nebius shares were down 5.65% at $175.50 at the time of publication Thursday, according to Benzinga Pro data.
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