Software Stocks Slide After Meta's New Enterprise Platform Prompts New AI Fears

Meta introduced Muse Wonder, a closed AI model, on October 12, 2026, accessible via a paid API. It competes with models like GPT-6.1 Sol and Gemini 4 Argon. Muse Wonder and Muse Wonder Full are closed models, while Muse Spark Open is downloadable. Pricing is $4 per million input tokens and $20 per million output tokens for Muse Wonder. Meta has not yet published benchmark data for Muse Wonder.

Microsoft canceled a data center lease with UK cloud company Nscale due to power grid delays, impacting a planned 50 MW AI supercomputer. Nscale, preparing for a U.S. IPO, faces challenges securing new tenants and meeting expansion targets. The UK's power grid constraints are hindering AI infrastructure growth.

Microsoft withdrew from a deal to anchor Nscale's UK data centre, according to the Telegraph. The project faces power connection delays until the 2030s. Nscale, which is seeking a $3B IPO, says its relationship with Microsoft remains strong. The move comes as AI infrastructure stocks face pressure, with CoreWeave down 25% last week.

The UK's Competition and Markets Authority (CMA) is considering designating Microsoft with strategic market status, which would increase regulatory oversight of its business software ecosystem. The move follows an investigation into Microsoft's market position and potential advantages in enterprise software, AI, and cybersecurity. Microsoft has rejected the CMA's assessment, arguing its products work with competing technologies. A final decision is expected in February 2027.

Microsoft withdrew from a data center deal with Nscale in Loughton, Essex, due to power supply delays until the 2030s. Nscale, preparing for a $3B IPO, faces challenges as Microsoft was to be the anchor tenant. Nscale is exploring alternative power sources and other UK sites, with Microsoft and Anthropic accounting for 85% of its contracts.

UnitedHealth, Meta, and Marvell are favored by analysts for long-term growth. UnitedHealth reported strong Q3 2026 results, raising its earnings outlook to at least $20.50 EPS. Meta's AI strategy and Muse AI agent's growth are in focus ahead of its Q3 earnings. Marvell increased its addressable market estimate to $400B by 2030, citing AI demand.