Stocks struggled Wednesday to kickstart a recovery following the latest stagger across world markets that has been caused by worries over an AI-fuelled bubble and uncertainty over US interest rates.Rising tensions between China and Japan linked to a spat over Taiwan added to the dour mood on trading floors.Investors have endured a tough November as speculation has grown that the tech-led rally this year may have gone too far, and valuations have become frothy enough to warrant a stiff correction.With the Magnificent Seven, including Amazon, Meta, Alphabet and Apple, accounting for the majority of the rally to record highs for Wall Street’s three main indexes, there are worries that any problems with them could have huge ripple effects on markets.And so the spotlight Wednesday turns on the earnings report from the biggest of the bunch: chip giant Nvidia, which this month became the first $5 trillion company. Investors are nervous that any sign of weakness could be the pin that pops the AI bubble, having spent months fearing that the hundreds of billions invested may have been excessive.”The AI complex, once the undisputed locomotive of 2025’s rally, now sounds like an engine with sand in the gears,” said Stephen Innes at SPI Asset Management.”This isn’t a crash, or a panic, or even a proper correction; it’s the unmistakable sensation of a market trading at altitude with borrowed oxygen, suddenly aware of how thin the air has become.”He added that four days of losses in Wall Street’s S&P 500, the VIX “fear index” hitting 25 — a level that causes traders concern — and a tone shift were “all signs that investors are finally blinking at the speed and scale of the AI capex boom”.Meanwhile, a Bank of America survey of fund managers found that more than half thought AI stocks were already in a bubble and 45 percent thought that that was the biggest “tail risk” to markets, more so than inflation.That came after the BBC released an interview with the head of Google’s parent company Alphabet — Sundar Pichai — who warned every company would be impacted if the AI bubble were to burst.After a mixed start to the day, Asia mostly fell into negative territory.Tokyo was weighed down by simmering China tensions after Japanese Prime Minister Sanae Takaichi’s comments on Taiwan, which have seen the two sides warn citizens about travel to the other.The row escalated Wednesday as media reports said China will suspend imports of Japanese seafood.Japanese investors are also concerned about the country’s fiscal state ahead of an economic stimulus package that has pushed government bond yields to record highs. Soft demand for the Bank of Japan’s latest bond sale added to unease among investors.Hong Kong, Sydney, Seoul, Singapore, Taipei, Wellington, Bangkok and Jakarta also fell but there were gains in Shanghai, Manila and Mumbai.London edged up as data showed UK inflation eased slightly in October.Frankfurt also rose but Paris slipped.Also in sight this week is the planned release of key US data, particularly on jobs creation, which will be closely read over for an idea about the Fed’s plans for interest rates.Investors have scaled back their bets on a third successive cut next month — weighing on markets of late — after a string of decision makers, including bank boss Jerome Powell, questioned the need for another as inflation remains stubbornly high.Bitcoin, which on Tuesday fell below $90,000 for the first time in seven months, remained under pressure from the risk-aversion on markets. The cryptocurrency has taken a hefty hit since hitting a record high above $126,000 at the start of October.- Key figures at around 0815 GMT -Tokyo – Nikkei 225: DOWN 0.3 percent at 48,537.70 (close)Hong Kong – Hang Seng Index: DOWN 0.4 percent at 25,830.65 (close)Shanghai – Composite: UP 0.2 percent at 3,946.74 (close)London – FTSE 100: UP 0.1 percent at 9,559.62Dollar/yen: DOWN at 155.50 yen from 155.53 yen on TuesdayEuro/dollar: UP at $1.1581 from $1.1580Pound/dollar: DOWN at $1.3141 from $1.3146Euro/pound: UP at 88.13 from 88.09 penceWest Texas Intermediate: DOWN 0.5 percent at $60.44 per barrelBrent North Sea Crude: DOWN 0.5 percent at $64.56 per barrelNew York – Dow: DOWN 1.1 percent at 46,091.74 (close)