Nebius Group (NBIS) is having a rough Friday. The stock is down more than 14% as a combination of macro headwinds and insider selling weighs on the AI infrastructure name.

Let's break down what's happening.

Hot Jobs Data Chills Rate Cut Hopes

The U.S. economy added 172,000 jobs in May, the Bureau of Labor Statistics reported Friday. That blew past the 85,000 economists were expecting. The data arrives less than two weeks before the Federal Reserve's June 16-17 meeting — the first chaired by Kevin Warsh, who succeeded Jerome Powell in May.

Markets took the report as unambiguously hawkish. The 2-year Treasury yield jumped about 10 basis points to 4.14%, and traders are now pricing in a roughly 58% chance of at least one rate hike by the December Fed decision, according to the CME FedWatch Tool. That's a big shift from earlier expectations of cuts.

For high-growth tech stocks like Nebius, higher rates are kryptonite. They make future cash flows less valuable and increase the cost of capital for capital-intensive AI infrastructure projects.

Insider Selling Adds Pressure

Compounding the macro headwinds, a massive insider transaction emerged. Nvidia (NVDA) Director Mark Stevens unloaded 1.31 million shares of Nebius over a three-day period from June 2 to June 4, cashing out $221.1 million. Despite the sale, it only reduced his overall position by 6.9%, so he still has a huge stake.

Insider sales can spook retail investors, especially when they're this large. But it's worth noting that Stevens is also a director at Nvidia, which has deep ties to Nebius. The sale might be for personal portfolio reasons rather than a signal about the company's prospects.

Institutional Backing Remains Strong

Despite Friday's selloff, Nebius still has some heavy hitters in its corner. A recent Schedule 13G filing revealed that hedge fund Situational Awareness LP disclosed a 5.6% passive stake in the company.

And during a keynote in Taipei, Nvidia CEO Jensen Huang highlighted Nebius's rapid growth, saying, "We worked with Nebius, and they are growing incredibly fast." That kind of endorsement from the king of AI hardware carries weight.

Short Interest on the Rise

Short interest in Nebius increased during the last reporting period, rising from 43.14 million shares to 45.10 million. That puts 21.1% of the company's publicly available shares short. Based on recent average daily volume of 19.6 million shares, it would take 2.3 days for short sellers to cover their positions — not extremely high, but notable.

At the time of publication, Nebius shares were trading at $222.72, down 14.23% on the day.