At the close on December 17, 2025, all three major U.S. indexes fell. The tech-heavy Nasdaq Composite sank 1.81%, the S&P 500 fell 1.16%, and the Dow Jones Industrial Average slipped 0.47%. Among the S&P 500’s 11 sectors, Information Technology led the declines, down 2.19%. Companies across the AI supply chain—software and hardware alike—were not spared.

Tech stocks, already under pressure from lofty valuations, saw panic selling after a double hit: a Financial Times report that Oracle’s $10 billion data-center financing had run into trouble, and a separate report describing major progress in China’s so-called chip “Manhattan Project.” 

Oracle’s $10 billion financing plan hits a snag

According to the Financial Times, Oracle has suffered a major financing setback for a 1-gigawatt data center planned in Saline Township, Michigan, designed specifically to serve OpenAI. The project is valued at up to $10 billion and is a key component of Oracle’s broader cooperation plan with OpenAI, said to total as much as $300 billion.

Oracle’s long-time data-center financing partner Blue Owl Capital has exited investment talks for the project. The negotiations reportedly collapsed because lenders—concerned about Oracle’s surging debt and enormous AI spending—pushed for tighter lease and debt terms, making the deal less financially attractive to Blue Owl. The episode exposed the funding strain behind Oracle’s AI strategy. As of late November 2025, Oracle’s net debt (including lease obligations) was about $105 billion.

The market’s concern is that if even private credit starts pulling back, the vast capital cycle funding AI infrastructure could face a break. Although Oracle said the project “remains on track” and that it has selected a new equity partner, investors voted with their feet.

Analysts further argued that the biggest engine that previously pushed markets higher—the AI theme—has now become one of the market’s largest risks. In judging an earnings inflection point, free cash flow may be a more reliable indicator than narratives. That implies companies like Oracle, with rapidly rising debt and negative free cash flow, could face heavier pressure.

China’s chip “Manhattan Project” achieves a breakthrough

According to Reuters, China has successfully built a full-scale prototype extreme ultraviolet (EUV) lithography chip-manufacturing plant inside a highly confidential facility in Shenzhen. EUV is the foundation for producing today’s most advanced semiconductors (such as AI chips and premium smartphone processors), and its core equipment has long been monopolized by Dutch company ASML.

Citing people familiar with the matter, the report says the project is internally likened to a chip-industry “Manhattan Project,” with the goal of producing working chips by 2028.

The project reportedly recruited former ASML employees and used the secondary market to purchase parts from older ASML equipment that had been replaced, attempting to assemble an independent production line. While the report notes China may still be years away from its stated objective, the existence of the factory prototype itself is a strong strategic signal: it suggests a real possibility of cracking the hardest and most single-supplier-dependent link in the global semiconductor supply chain—advanced-node manufacturing. This shakes the market’s core belief that Western technology containment measures will remain effective over the long term.