Wall Street's AI Party Hits a Hangover: GS, MS Slide as OpenAI Ghosts the IPO Calendar

Let's set the scene: $GS and $MS are both down 3–4% after OpenAI decided to push its IPO to 2027, ripping away the capital markets catalyst both banks had been quietly banking on. Meanwhile, $ON (ON Semiconductor) cratered 24% — its worst single-day drop since March 2020 — on an all-stock deal that the market absolutely did not appreciate. The Mag 7's average multiple has compressed from 35x to 25x as hyperscaler capex anxiety goes mainstream, per Bloomberg Surveillance's morning rundown.

On the macro front, Iran is threatening to close the Strait of Hormuz, Saudi Aramco's CEO is skipping conferences, and Brent crude is sitting around $74/barrel — well below the apocalyptic $150–200 predictions that didn't age well. Bloomberg's Odd Lots breakdown explains why: China quietly cut crude imports by 5–6 million barrels/day, single-handedly absorbing half the supply shock. Dollar is rising on haven demand. UK gilts are falling. And Jeremy Grantham is somewhere nodding slowly, having called this the most expensive market in American history with a potential 70% drawdown to trend.

The social sentiment playbook right now: rotate out of crowded AI names, add infrastructure and productivity beneficiaries on weakness, and maybe — just maybe — stop assuming every OpenAI headline is a free lunch for investment banks.