Oracle bonds are dangerously close to junk status as the market cools on the artificial intelligence (AI) boom. Investors have pushed up the cost of default insurance for Oracle, with its five-year credit default swap (CDS) spread currently at 295 basis points, a 287% surge from a year ago, and briefly touching 300 basis points on Thursday. Gavan Nolan, Executive Director at S&P Global Market Intelligence, noted that this spread range is more akin to the BB and B credit ratings of high-yield bonds. S&P Credit Ratings had already downgraded Oracle's rating to BBB- in July, the lowest investment-grade rating, citing the company's rapidly expanding infrastructure business as increasing overall credit risk.