Palantir Technologies has faced a challenging November, witnessing a 16% drop in its stock price, marking its worst month in two years. This decline comes as investors are increasingly wary of high valuations in the AI sector, leading to a broader sell-off of AI stocks. Notably, famed investor Michael Burry has taken a position against Palantir, further fueling concerns about the company’s future in a market that appears to be recalibrating its expectations.

The recent volatility in the stock markets, particularly in the US and Asia, highlights growing concerns about an AI bubble. Despite strong performances from tech giants like Nvidia and robust economic indicators, investor jitters have led to a significant decline in major stock indexes. The S&P 500, for instance, has dropped over 4% this month, signaling a potential market correction. Analysts are particularly worried about the concentration of market power among a few tech companies, often referred to as the ‘magnificent seven.