Global Markets: Stocks fall as Meta dents AI optimism; French bonds under fire

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Meta plans non-voting stock issue, reviving concern over spending
Brent crude rises 3% to $112 barrel after Houthi attacks
US 10-year Treasury yield below France's for first time in 13 years
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By Amanda Cooper and Alun John
LONDON, Oct 22 (Reuters) - Global stocks retreated on Thursday, as tech earnings could not offset nagging concern over the outlook for AI, while a stalemate in the Gulf pushed up oil prices and investors took aim again at French markets.
MSCI's All-World index .MIWD00000PUS was set for its largest daily fall in two weeks, down 0.4%, as tech shares from Seoul and Tokyo to Amsterdam and Paris tumbled. 
Meta META.O, the first of the so-called AI hyperscalers to publish quarterly results, reported third-quarter revenue late on Wednesday that beat expectations. But any optimism was short-lived, after the company unveiled a plan to issue non-voting stock that revived concern over its mounting capital commitments.
"There are lots of crosscurrents in markets at the moment, which are grappling for a narrative right now," Ben Laidler, head of macro and equity strategy at Bradesco BBI, said.
"The big concern is that AI-driven earnings narrative, which has supported US earnings and spread to global equities, may be challenged here."
Meta also suffered a legal blow overnight, after a judge in New Mexico ordered the company to pay a $25 billion penalty to the state in a data privacy case.
In Europe, the STOXX 600 .STOXX fell 0.7%, weighed down by tech-related stocks such as ASML ASML.AS, Schneider Electric SCHN.PA and Siemens Energy ENR1n.DE. US stock futures ESc1, NQc1 fell between 1% and 1.7%, suggesting a drop at the opening bell later.
Shares in Meta fell around 3% and those in Tesla TSLA.O, which also reported earnings and cut its spending forecast ahead of a possible merger with SpaceX SPCX.O, dropped nearly 4% in the premarket.
Geopolitical concerns played out in oil markets, where Brent crude LCOc1 rose nearly 3% to $112 a barrel, near a five-month high, after more Houthi attacks in Saudi Arabia raised the risk of wider conflict and supply disruptions in the Middle East.
There was enough nervousness about the possible damage to the global economy to offset concern about a sustained pickup in inflation to drive flows into government bonds, which pushed US Treasury yields down by the most in a week. The 10-year note US10YT=RR was last 10 basis points lower at 5.05%, trading below that of France FR10YT=RR for the first time in 13 years.
French government bonds have been battered this month, driving yields above 5% for the first time since 2002, as investors looked for signs the government can contain social unrest and bring spending under control. French 10-year yields rose 11 bps to 5.107%, headed for their largest weekly rise since May.
The euro EUR=, which has been dragged 0.8% lower this month, was steady on Thursday, falling 0.3% to $1.12, leaving the dollar index =USD, which tracks the US currency against a basket of six others, up 0.1%. 
The yen JPY= drew safe-haven demand, leaving the dollar down 0.7% on the day at 157.1, after Deputy Bank of Japan Governor Ryozo Himino signalled his readiness to raise borrowing costs.
Gold XAU= missed out on safe-haven flows, dropping 1.8% to $4,070 an ounce, while in cryptocurrencies, bitcoin BTC= and ether ETH= both lost 3.5% to trade at $81,837 and $2,405, respectively. 
     

 (Additional reporting by Jiaxing Li in Hong Kong; Editing by Kate Mayberry, Shri Navaratnam, Susan Fenton, Elaine Hardcastle)
 ((jiaxing.li@thomsonreuters.com))