What Happens to AI Stocks if the Fed Hikes Rates Again?

The Federal Reserve raised rates in September and investors expect at least one more hike before year-end. Rising interest rates negatively impact AI stocks through two mechanisms: reduced present value of future earnings for growth companies and increased borrowing costs for expensive AI infrastructure buildouts. Well-capitalized companies like Nvidia and Alphabet are minimally vulnerable, while less profitable companies dependent on debt financing like CoreWeave face greater pressure.