AI investor jitters spill into bond market

Good morning and welcome back. In today’s newsletter:

• AI investor jitters hit tech bonds

• EU to set up intelligence unit

• BBC faces ‘existential’ threat

• Switzerland inches towards US trade deal

We begin in the US, where investors have been selling off the debt of tech heavyweights, showing how jitters over Silicon Valley’s boom in spending on artificial intelligence have spilled into the bond market.

What we know: A basket of bonds issued by so-called hyperscalers — companies that are building vast data centres, such as Alphabet, Meta and Microsoft — has sustained a hit in recent weeks.

The spread, or premium in yield investors demand to buy the debt over Treasuries, has climbed to the highest level since US President Donald Trump sent markets reeling in April with his tariff plans, according to Bank of America data.

Why it matters: The widening spread highlights investors’ concern over the way tech groups are turning to debt markets to finance their investments in AI infrastructure. Tech giants are issuing debt at a quick clip despite having cash hoards, something some investors worry could signal a shift to higher levels of leverage.

Read more on this exclusive story from Kate Duguid and Tabby Kinder.

Here’s what else I’m keeping tabs on today:

• Armistice Day: Countries around the world commemorate those who have died in conflicts.

• UK: FT Live’s two-day Global Pharma and Biotech Summit begins in London. Register here.

• Iraq: The country holds parliamentary elections.

Five more top stories

1. Exclusive: The European Commission has begun setting up an intelligence body under president Ursula von der Leyen, in an attempt to improve the use of information gathered by national spy agencies. Read details of the plans.

• ‘Cum-ex’ scandal: Denmark is facing one of the largest legal bills in English history after the country lost a high-stakes tax fraud case in London.

• German borrowings: Chancellor Friedrich Merz has been accused of using billions of new debt intended for defence and investments to fund welfare and tax cuts.

2. The shock exit of the BBC’s top executives following a dispute over impartiality has come as the national broadcaster faces questions over its future role in British society. Read more on the deepening crisis at the UK institution.

3. Switzerland is inching closer to a deal to cut tariffs on its exports to about 15 per cent, as companies from Rolex to Richemont take the lead in breaking months of deadlock between Bern and Washington. Read more about the talks.

4. Warren Buffett has told Berkshire Hathaway shareholders that he is “going quiet” as the world’s most famous investor draws a line under a career that has shaped corporate America and Wall Street over the past six decades. Read more from Buffett as he prepares to retire as chief executive.

• More US news: A cross-party pact to end the longest US government shutdown in history cleared the Senate last night, but rebel Democrats who backed the deal face a backlash.

5. Exclusive: Lloyds Banking Group analysed data from the personal bank accounts of more than 30,000 employees to assess their financial resilience as part of pay negotiations. Some union officials have complained that the analysis was an invasion of staff privacy. Read the full story.

The FT Weekend Magazine is putting together its inaugural Influence List. Who are the personalities that have helped shape this year? Submit your nominations below this story.

The Big Read

The $23bn Simandou mine in Guinea, which has taken almost three decades to begin operating, could tilt the balance of power in the global iron ore market. The west African nation is hoping the mine, which will be inaugurated today, can change its fortunes. Read more on the world’s biggest mining project.

We’re also reading . . . 

• Airport lounge network: A British company is hoping to reduce overcrowding and give passengers a calmer experience, writes John Gapper.

• ‘Drastic Dave’ Lewis: Diageo has called in the former Tesco boss to steer the drinks group through a shift in consumer habits.

• Jack Ma family property: The Alibaba founder’s wife has bought a London home that was used as an Italian embassy for £19.5mn, records show.

• Maga + AI: The latest tech bubble offers only short-term protection for Donald Trump, writes Adam Tooze.

Chart of the day

The industrial city of Katowice has transformed itself from a former mining stronghold to a vibrant hub for banking, IT and gaming companies — a reflection of Poland’s economic outperformance since joining the EU.

Join FT experts on November 28 at 1pm London time to analyse how UK chancellor Rachel Reeves’ Autumn Budget will affect the economy. Subscribers can register for this exclusive event here.  

Take a break from the news . . . 

David Szalay has won the 2025 Booker Prize for fiction with Flesh, his portrait of a man from adolescence on a Hungarian social housing estate to the world of London’s super-rich. Find out how the book captivated the panel of judges.